Rouble hits three-week low vs dollar on global economic concern

• Russian rouble weakened to a three-week low against the U.S. dollar on Wednesday.
• The rouble shed 0.3pc to 65.48 against the dollar, its weakest level since Sept. 11. Versus the euro.

MOSCOW: The Russian rouble weakened to a three-week low against the U.S. dollar on Wednesday, pricing in a recent drop in oil prices and increased concerns about the health of the global economy.

At 0752 GMT, the rouble shed 0.3pc to 65.48 against the dollar, its weakest level since Sept. 11. Versus the euro, the rouble lost 0.2pc to 71.51.

The rouble and other emerging-market currencies came under pressure from global economic concerns after a report showed U.S. manufacturing contracted in September to its weakest in more than a decade amid trade tensions between China and the United States.

A weekly auction of Russian OFZ treasury bonds is in focus on Wednesday. The finance ministry is set to offer an unlimited amount of OFZ bonds maturing in 2030, testing the market demand that is usually seen as a gauge of investor sentiment towards Russian assets.

The OFZ auction, however, is unlikely to support the rouble given the pessimism in global markets, Nordea Bank analysts said in a note.

The finance ministry said earlier this week it decided to increase its domestic borrowing plan for the fourth quarter to 420 billion roubles ($6.42 billion) from the 300 billion roubles that the ministry planned to raise in the third quarter.

Expectations of an increase in state foreign-currency purchases also add downside pressure on the rouble.

A monthly Reuters poll forecast the finance ministry would increase daily FX buying in October.

Russian stock indexes were down. The dollar-denominated RTS index slid 0.6pc to 1,321.8 points. The rouble-based MOEX Russian index was 0.5pc lower at 2,756.4 points.