Russian rouble steadies as oil prices climb, risk aversion eases
- The rouble was 0.1% stronger against the dollar at 74.34 and up 0.1% at 87.51 versus the euro .
- Brent crude oil, a global benchmark for Russia's main export, was up 1.5% at $70.38 a barrel.
MOSCOW: The Russian rouble steadied on Wednesday as oil prices climbed and global risk aversion eased, even as fears grew over spreading cases of the Delta coronavirus variant, with investors keeping an eye on Friday's central bank rate decision.
By 1122 GMT, the rouble was 0.1% stronger against the dollar at 74.34 and up 0.1% at 87.51 versus the euro .
The dollar-rouble pair is likely to stay in a narrow range of 74-74.6 until the central bank's rate decision on Friday, provided the external background remains calm, Alor Broker said in a note.
A Reuters poll on Monday showed market expectations leaning towards a 100 basis point hike, to 6.50%, as the central bank strives to keep inflation in check.
Russian rouble firms towards 74 vs dollar as oil prices edge higher
Higher borrowing costs can negatively impact economic growth but provide support for the currency and increase the appeal of bank deposits.
Brent crude oil, a global benchmark for Russia's main export, was up 1.5% at $70.38 a barrel.
Oil prices dived on Monday after OPEC+ ministers agreed a day earlier to increase oil supply from August to cool prices.
Rising COVID-19 cases and the more infectious Delta strain, as well as fears of prolonged and rising inflation, are hindering the global economic recovery, BCS Global Markets said in a note.
However as sentiment improves, the dollar is likely to stop strengthening, Sberbank CIB analysts said, which could see the rouble firm to the 74 mark.
Russian rouble weakens as oil prices edge lower
Russia's finance ministry sold 20 billion roubles ($269 million) of OFZ bonds at one auction on Wednesday. These bonds are popular among foreign investors for their lucrative yields, but US sanctions have barred US banks from buying rouble-denominated state debt since June 14.
Russian stock indexes were climbing.
The dollar-denominated RTS index was up 0.7% to 1,578.0 points. The rouble-based MOEX Russian index was 0.5% higher at 3,723.9 points after slipping to 3,679.44, its weakest point since May 25, on Tuesday.
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