MOSCOW: The Russian rouble steadied on Friday, holding onto large gains made in the previous session as fears of an imminent escalation of tensions over Ukraine eased, while stocks continued their resurgence after a sell-off early this week.

Russia said on Thursday it was clear the United States was not willing to address its main security concerns in their standoff over Ukraine, but both sides kept the door open to further dialogue, soothing investors' concerns and limiting losses across Russian markets.

The West has threatened sanctions with profound economic effects should Russia attack Ukraine. Moscow has repeatedly denied planning an invasion.

At 0731 GMT, the rouble was 0.1% stronger against the dollar at 77.91, near a one-week high after gaining more than 2% on Thursday.

Russian rouble rebounds from near 15-month low as Ukraine fears ease

It had gained 0.3% to trade at 86.74 versus the euro.

"Headlines over the last two days have suggested an improvement in the geopolitical back-and-forth, but risk remains high and the global backdrop also fails to inspire as the Fed turns hawkish," said BCS Global Markets. "Any gains will likely come with caution, especially at the close of the week."

US Federal Reserve chair Jerome Powell unleashed bets on five or more hikes this year after he left the door open on Wednesday to raising rates faster than in previous cycles, supporting the dollar globally.

Yields on Russia's 10-year OFZ bond yields dropped to their lowest since Monday at 9.48%, down from their highest since early 2016 of 9.86% hit this week. Yields move inversely to prices.

Brent crude oil, a global benchmark for Russia's main export, was up 0.6% at $89.86 a barrel.

Russian stock indexes were climbing, continuing their rebound after a huge sell-off on Monday.

The dollar-denominated RTS index was up 0.6% to 1,408.7 points. The rouble-based MOEX Russian index was 0.8% higher at 3,484.0 points, earlier touching a 10-day high of 3,534.40 points.