Rouble firms, heading back towards multi-year highs vs dollar, euro
May 23 (Reuters) – The Russian rouble strengthened on
Monday, heading back towards multi-year highs hit against the
dollar and euro last week, supported by capital controls and an
upcoming month-end tax period.
At 0754 GMT, the rouble was 2.5% stronger against the dollar
at 58.74, not far from 57.0750, its strongest
mark since late March 2018, hit on Friday.
It had gained 2.3% to trade at 61.38 versus the euro
, nearing its strongest point since June 2015 of
59.02, also reached on Friday.
The rouble has firmed about 30% to the dollar this year
despite a full-scale economic crisis in Russia, making it the
world’s best-performing currency https://emea1.apps.cp.thomsonreuters.com/Apps/NewsServices/mediaProxy?apiKey=6d416f26-7b24-4f31-beb6-1b5aa0f3fafb&url=http%3A%2F%2Ffingfx.thomsonreuters.com%2Fgfx%2Frngs%2FGLOBAL-CURRENCIES-PERFORMANCE%2F0100301V041%2Findex.html,
albeit artificially supported by controls imposed in late
February to shield Russia’s financial sector after it sent tens
of thousands of troops into Ukraine.
The rouble is being driven by export-focused companies that
are obliged to convert their foreign currency revenue after
Western sanctions froze nearly half of Russia’s gold and forex
Russian demands that foreign buyers pay for gas in roubles
has also contributed to the rouble’s recent rally, analysts said
The supply of foreign currency from exporters, high oil
prices and an upcoming month-end tax period that usually prompts
export-focused companies to convert their forex revenues into
roubles to meet local liabilities are all supporting the Russian
currency, said BCS Express in a note.
The Vedomosti daily reported on Monday, citing sources, that
the central bank had started purchasing foreign currency in
order to stop the rouble’s uncontrolled strengthening.
The central bank denied the report, saying “this information
does not correspond to reality.”
If the central bank were carrying out such interventions,
the effect on the rouble rate would be more noticeable, said
“Nevertheless, such news could influence the behaviour of
market participants and provoke a weakening of the rouble.”
Russian stock indexes were mixed.
The dollar-denominated RTS index was up 2.2% to
1,277.2 points. The rouble-based MOEX Russian index was
0.4% lower at 2,364.3 points.
(Reporting by Reuters, Editing by William Maclean)