Home Business Russian rouble weakens towards 62 vs dollar as oil price cap looms

Russian rouble weakens towards 62 vs dollar as oil price cap looms

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MOSCOW — The rouble extended the week’s losses on Friday, slumping to fresh lows against the dollar, euro and yuan as the Russian currency traded without the support of a favorable month-end tax period and under pressure from an upcoming oil price cap.

By 1207 GMT, the rouble was 0.7% weaker against the dollar at 61.90, its weakest mark since Nov. 7.

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It had lost 0.8% to trade at 64.99 versus the euro , at its weakest since July 7, and had shed 1% against the yuan to 8.81, slipping to its weakest since mid-October.

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While the Chinese yuan has been making gradual inroads into Russia for years, the crawl has turned into a sprint in the past nine months as the currency swept into the country’s markets and trade flows, according to a Reuters review of data and interviews with 10 business and finance players.

The rouble has now lost support from a favorable month-end tax period that usually sees Russian exporters convert foreign currency revenues into roubles to pay local liabilities.

“In addition, the national currency is under pressure from news on the EU’s oil price ceiling,” said Evgeniy Linchik of First Asset Management.

European Union governments have tentatively agreed on a $60 a barrel price cap on Russian seaborne oil with an adjustment mechanism to keep the cap at 5% below the market price, according to diplomats and a document seen by Reuters.

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Brent crude oil, a global benchmark for Russia’s main export, was up 0.6% at $87.4 a barrel.

“The Russian market remains in consolidation mode – we still see no major drivers until the end of the year,” said BCS World of Investments. “Lower volatility supports the sideways trend.”

Russian stock indexes were lower.

The dollar-denominated RTS index was down 1.4% at 1,107.6 points. The rouble-based MOEX Russian index was 0.5% lower at 2,176.7 points.

For Russian equities guide see

For Russian treasury bonds see (Reporting by Alexander Marrow; Editing by Sherry Jacob-Phillips and Susan Fenton)



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