Rouble gains towards 73 vs dollar, RTS at highest since March

MOSCOW: The Russian rouble on Tuesday firmed against the dollar to more than three-month peak and the dollar-based RTS stock index climbed to its highest since March.

At 1003 GMT, the rouble was 0.7pc stronger against the dollar at 73.14, having briefly hit 73.05, a level last seen on Aug. 19.

The rouble has been recovering since the U.S. presidential election in early November, paring losses inflicted by fears Moscow would see new Western sanctions related to the U.S. vote, the suspected poisoning of Kremlin critic Alexei Navalny and a political crisis in neighbouring Belarus.

"Looks like foreign investors are now ready to actively buy the rouble, which reflects an easing of geopolitical concerns. At the same time, there is no strong demand for FX, which allows the rouble to firm steadily," Sberbank CIB said in a note.

The dollar finished Monday's trade below the 200-day moving average, which created a "moderately-positive technical picture for the rouble", said Dmitry Polevoy, head of investment at Locko Invest.

The rouble may see extra support later in December from month-end tax payments that usually prompt export-focused companies to increase conversion of FX to meet local liabilities.

In 2021, the rouble has chances of further recovery as the economy is seen expanding by 3.8pc, showing its fastest growth since 2012, assuming no new Western sanctions are imposed on Moscow, the head of Russian credit rating agency ACRA told Reuters in an interview.

Versus the euro, the rouble firmed 0.5pc to 88.67, hovering far away from levels of around 70 seen in early 2020, before oil prices collapsed and the coronavirus pandemic prompted wide-scale lockdowns.

Brent crude oil, a global benchmark for Russia's main export, was down 0.4pc at $48.62 a barrel, pressured by concerns about global demand amid surging coronavirus cases.

Russian stock indexes were mixed after posting gains on Monday.

The dollar-denominated RTS index was up 0.2pc to 1,371.3 points, its strongest levels since early March. The rouble-based MOEX Russian index shed 0.3pc to 3,184.1 points.