Rouble slips after biggest one-day gain in four years

MOSCOW: The Russian rouble weakened on Friday after posting its biggest one-day gain against the dollar since November 2016, as oil prices fell and markets remained on edge over vote-counting in the US presidential election.

Investors are betting that Democrat Joe Biden will become the next president but Republicans will retain control of the Senate, which will make it difficult for the Democrats to pass the larger fiscal spending package they have been pushing.

The rouble was likely to benefit from the division of power in Washington, ITI Capital said in a note.

For weeks, the rouble has been under pressure over fears of more sanctions against Moscow, something that some analysts said was possible should Biden win.

At 1310 GMT, the had rouble shed 1.1% to 77.83 against the dollar, heading away from 76.78, its strongest level since Oct. 27 that it hit on Thursday.

"The dollar was too oversold ... there is some adjustment in market positions going on now," said an FX dealer at a major Russian bank in Moscow.

Brent crude oil, a global benchmark for Russia's main export, put pressure on the rouble and stocks as it fell 2.7% to $39.81 a barrel on concerns about the outlook for demand.

"We think the rouble will likely slip to 78 against the dollar amid deteriorating sentiment in markets today," Sberbank CIB said.

Versus the euro, the Russian currency fell 1.5% to 92.43 .

The rouble traded around 61 to the dollar and 70 against the euro in early 2020 before oil prices fell and the coronavirus crisis hit Russia.

COVID-19 infections were on the rise in Russia and the Kremlin has said the situation was alarming, though it had no plans for a lockdown.

Russian stock indexes were mixed before the weekend.

The dollar-denominated RTS index slid 1% to 1,158.6 points after rallying the day before. The rouble-based MOEX Russian index added 0.1% to 2,864.0.