A view shows Russian ruble coins in this illustrative image taken on March 25, 2021. REUTERS/Maxim Shemetov/Illustration/File Photo
April 11 – The Russian ruble weakened sharply on Monday in jittery trading, reversing some of the previous week’s gains after the central bank decided to ease temporary capital control measures aimed at limiting the currency’s decline .
Late Friday, the central bank announced that it would eliminate a 12% commission on buying foreign currency through brokers from April 11 and lift a temporary ban on selling foreign exchange cash to individuals from April 18. Read more
The ruble fell to 82.09 against the dollar at the Moscow market open, from 71 rubles hit on Friday, the strongest since Nov. 11.
By 0727 GMT on the day, the ruble was almost 5% weaker at 79.90 against the dollar and 4.3% lower against the euro at 86.35.
The decision to scrap the 12% commission on forex operations means speculators can trade again, Alor Brokerage said, adding that market participants tended to make even small profits.
The ruble is supported by the mandatory conversion of 80% of foreign exchange earnings by export-oriented companies, as well as high interest rates, despite the central bank unexpectedly cutting interest rates from 20% to 17% last week. Continue reading
Analysts at ITI Capital said Russia receives about $1.4 billion in export earnings a day and the ruble could firm further amid Russian capital controls and shrinking imports.
Central bank cut supported Russian OFZ government bonds. The Treasury said over the weekend it would not borrow from local or overseas bond markets this year.
Finance Minister Anton Siluanov also said that Russia will take legal action if the West tries to force it to default on its sovereign debt. Continue reading
Yields on 10-year OFZs, which move inversely with their prices, fell to 10.62% on Monday. That was the lowest level since February 22, two days before Russia launched what it called a “military special operation” in Ukraine, triggering unprecedented Western sanctions against Russia.
In the stock market, the dollar-denominated RTS index (.IRTS) fell 4.5 percentage points to 1,031.4, but the ruble-based Russian MOEX index (.IMOEX) was down 0.8% to 2,614.0 Points up, helped by the fall in the ruble.
Reporting by Reuters Editor-in-Chief David Goodman