MOSCOW: The Russian rouble pared losses on Thursday while stock indexes extended their recovery after falling sharply on geopolitical fears.

At 0724 GMT, the rouble strengthened by 0.5% against the dollar to 74.65, moving away from the 75.29 hit on Tuesday, its weakest since mid-2021.

Trading activity in Russia is likely to be muted on Thursday, with US markets closed for the Thanksgiving holiday.

The rouble has slipped sharply in the past two weeks, weakening from a multi-month peak of 69.21 in late October, coming under selling pressure related to Western concerns over possible Russian military intervention in Ukraine.

Russia has dismissed such concerns and has also complained about increasing activity in the region by the NATO military alliance.

"While a conflict with Ukraine is widely deemed unlikely, escalated sabre rattling carries the risk of unintended consequences," BCS Global Markets said.

Against the euro, the rouble strengthened by 0.2% to 83.74.

The rouble still retains fundamental support from Russia's strong current account surplus and the central bank, which is expected to raise interest rates again at its Dec. 17 board meeting to fight stubbornly high inflation.

The Russian Economy Minister warned on Wednesday that the recent drop in the Russian rouble could push 2021 inflation above the previous forecast of 7.4%.

Russian stock indexes were up, with the dollar-denominated RTS index gaining 1.2% to 1,679.8. The rouble-based MOEX Russian index advanced by 0.7% to 3,978.5 points, heading away from the 3,776.61 hit on Tuesday, its lowest since early August.