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Rouble hits one-week low as market treads water before tax payments

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The rouble hit a more than one-week low against the dollar in early trade on Thursday before paring some losses as the market waited for next week’s month-end tax payments that will likely benefit the Russian currency.

At 0707 GMT, the rouble was 0.1% weaker against the dollar at 69.40, earlier falling to 69.73, its weakest point since Jan. 18.

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It had lost 0.3% to trade at 75.68 versus the euro . It had shed 0.6% against the yuan to 10.28 .

The rouble has been buttressed this month by large FX sales by the government, which is offloading up to 3.2 billion roubles ($46.11 million) per day of Chinese yuan, a move analysts say could lead to a vicious circle that sees the rouble strengthen and further reduces the Kremlin’s crucial export revenues.

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Others expect a more limited effect.

“Foreign currency interventions have exhausted their influence on the rouble rate and quotes have entered a weakly rising trend,” Finam brokerage said in a note.

The rouble may test the 70 mark to the dollar this week, they added.

The Russian currency could gain support from month-end tax payments, due on Jan. 30, when exporters usually convert foreign exchange revenue to pay local liabilities.

Brent crude oil, a global benchmark for Russia’s main export, was up 0.2% at $86.3 a barrel.

Russian stock indexes were higher.

The dollar-denominated RTS index was up 0.2% to 988.7 points. The rouble-based MOEX Russian index was 0.4% higher at 2,178.2 points.

For Russian equities guide see

For Russian treasury bonds see ($1 = 69.4000 roubles) (Reporting by Alexander Marrow; additional reporting by Elena Fabrichnaya; Editing by Kim Coghill)


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