Rouble recovers from 15-month low after plunge to 90 vs dollar

MOSCOW: The Russian rouble pared most of its intraday losses on Tuesday after plunging to a more than 15-month low past 90 against the dollar, weighed down by domestic political concerns and strong demand for foreign currency in the face of limited supply.

By 1503 GMT, the rouble was 0.1% weaker against the dollar at 88.77, after earlier hitting 90.04, its weakest since March 28, 2022.

It lost 0.2% to trade at 96.79 versus the euro and shed 0.7% against the yuan to 12.27 , earlier hitting a more than 14-month low.

The central bank sought to downplay the impact of the rouble’s plunge on Tuesday, stating that there were no risks to financial stability and putting the sharp decline down to reduced export revenues combined with recovering imports.

The rouble started recovering soon after.

Capital controls have helped insulate the rouble against geopolitics in the 16 months since Russia invaded Ukraine, but mercenary leader Yevgeny Prigozhin’s aborted march toward Moscow on June 24 reverberated through markets and raised questions about President Vladimir Putin’s grip on power.

The Bank of Russia’s First Deputy Governor Ksenia Yudaeva said the bank for now saw no need to return to mandatory foreign currency sales, RIA news agency reported.

The rouble lost more than 9% in June and is down around 20% so far this year, making it one of the world’s worst performing currencies.