Make Kitco Your Homepage

Market News

Rouble firms to 1 year-high vs euro, month peak vs dollar

Reuters

Kitco News

MOSCOW, April 22 (Reuters) - The rouble hit its highest level against the euro since last April and a one month-peak versus the dollar on Monday, driven by a jump in oil prices and local month-end taxes that boost demand for the Russian currency.


The rouble had gained 0.5 percent to 71.71 against the euro by 0723 GMT , after briefly hitting its strongest level since April 6 last year at 71.65.


Against the dollar, the rouble firmed 0.5 percent to 63.76, a level last seen on March 22. A break through 63.63 would put the currency at levels last seen in August, reversing a collapse sparked by intensified fears about an increase in U.S. sanctions.


"We see chances for the USD/RUB to enter the 63.0-63.5 range in the short term," said analysts at Rosbank, a subsidiary of Societe Generale.


Major local tax duties are due on April 25, which should increase foreign currency selling from export-focused companies, the analysts added.


"Moreover, we expect the central bank to slightly soften its tone on Friday without changing the key rate, which should support a positive mood on the Russian market."


The board of the central bank of Russia (CBR) will hold its next policy meeting on Friday. The market expects the bank to hold the key rate at 7.75 percent after also leaving it unchanged last month. "In our view, the CBR's recent communication precludes a key rate change," VTB Capital said in a note.


Oil prices provided wider support for Russian assets. Brent crude oil , a global benchmark for Russia's main export, was up 2.9 percent at $74.06 a barrel, its highest since November.


The dollar-denominated RTS index was up 1.1 percent to 1,274.9 points, while the rouble-based MOEX Russian index was 0.7 percent higher at 2,581.6 points.


For Russian equities guide see For Russian treasury bonds see (Reporting by Andrey Ostroukh; Editing by Kirsten Donovan)

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.