Bloomberg News

Ruble Drops to Week-Low Versus Dollar as Crude Oil Retreats

July 06, 2011

July 6 (Bloomberg) -- The ruble slid to its lowest level in a week versus the dollar as oil, Russia’s chief export earner, declined after China’s central bank raised rates.

The Russian currency depreciated 0.5 percent to 28.0065 per dollar by the 7 p.m. close in Moscow, the weakest since June 28. The ruble was 0.6 percent stronger at 40.09 per euro, leaving it steady at 33.4441 versus the central bank’s target dollar-euro basket.

Crude tumbled as much as 1 percent in New York as the People’s Bank of China said benchmark deposit and lending rates will rise 25 basis points tomorrow. The euro weakened against the dollar after Moody’s Investors Service cut Portugal’s rating to junk status, curbing the appeal of dollar-denominated commodities.

Russian government bonds fell, pushing the yield on the ruble Eurobond up three basis points to 6.886 percent. Non- deliverable forwards, which provide a guide to expectations of currency movements and allow companies to hedge against them, show the ruble at 28.2607 per dollar in three months, compared with 28.1225 yesterday.

--Editors: Alex Nicholson, Linda Shen

To contact the reporter on this story: Jack Jordan in Moscow at jjordan22@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net


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