Bloomberg News

Ruble Extends Worst Streak of Declines in 3 Years on Europe Woes

December 15, 2011

Dec. 15 (Bloomberg) -- The ruble weakened for an 11th day against the dollar as concern Europe’s debt crisis will hobble the global economic recovery intensified, curbing investor appetite for riskier assets.

The Russian currency depreciated 0.1 percent to 31.8575 as of 2:54 p.m. in Moscow, extending its worst losing streak since January 2009 and heading for the lowest closing level since Oct. 7. The ruble was 0.2 percent weaker at 41.43 versus the euro, leaving it down 0.2 percent at 36.1651 against the central bank’s target dollar-euro basket.

Plans to create a closer European fiscal union have failed to reassure investors, sending Italy’s five-year bond yield to a 14-year high at an auction yesterday. Oil, Russia’s chief export earner, climbed 99 cents to $95.94 a barrel after retreating 5.2 percent to a five-week low yesterday.

Investors increased bets the Russian currency will weaken further, with non-deliverable forwards showing the ruble at 32.3018 per dollar in three months, compared with expectations of 32.3575 per dollar yesterday.

Russia’s dollar-denominated Eurobond due in 2020 rose, decreasing the yield seven basis points to 4.558 percent.

--With assistance from Denis Maternovsky in Moscow. Editors: Ash Kumar, Alex Nicholson

To contact the reporter on this story: Alex Nicholson in Moscow at anicholson6@bloomberg.net

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


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