Nov. 25 (Bloomberg) -- The ruble advanced against the central bank’s target dollar-euro basket, snapping its longest losing streak in two months, as oil climbed in New York.
The Russian currency gained 0.2 percent to 36.1125 against the basket by the 7 p.m. close in Moscow, paring its weekly loss to 1 percent. The ruble dropped against the basket for seven trading session before today, the longest stretch of declines since Sept. 26.
Crude futures advanced 0.8 percent to $96.90 a barrel in New York after Italian Prime Minister Mario Monti told a cabinet meeting that German Chancellor Angela Merkel and French President Nicolas Sarkozy “confirmed their support for Italy,” a sign Europe’s leaders may be uniting in the effort to contain the region’s debt crisis. The European Union is Russia’s largest trading partner.
“I don’t think there’s going to be a rout in the ruble, unless problems in Europe cause a Lehman type of credit breakdown,” Peter Rosenstreich, chief currency analyst at Swissquote Bank SA in Geneva, said by e-mail,referring to the bankruptcy of Lehman Brothers Holdings Inc. Swissquote expects the ruble to weaken by as much as 2.4 percent to about 37 against the basket by the end of 2011, he said.
The ruble depreciated 13 percent against the basket in the last quarter of 2008, amid the collapse of Lehman and the global credit crisis, the biggest quarterly drop on record.
The Russian currency traded 0.1 percent lower at 31.5 per dollar today, and strengthened 0.5 percent to 41.75 per euro. Investors increased bets the ruble would weaken further, with non-deliverable forwards showing it at 31.9602 per dollar in three months, compared with 31.9420 per dollar yesterday.
Russia’s $3.5 billion of Eurobonds due 2020 fell, pushing the yield up 19 basis points, or 0.19 percentage point, to 4.844 percent.
Bank Rossii kept interest rates on hold at its meeting in Moscow today, as predicted by all 24 economists in a Bloomberg survey.
--Editors: Linda Shen, Gavin Serkin
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