Bloomberg News

Ruble Rises for Second Day Against Dollar as Oil Price Increases

January 09, 2012

Jan. 9 (Bloomberg) -- The ruble strengthened for a second day against the dollar as Urals crude oil, Russia’s chief export earner, climbed to an eight-week high.

The Russian currency added 0.4 percent to 31.87 as of 1:32 p.m. in Moscow, after gaining 0.9 percent last week. The ruble was little changed at 40.63 per euro, leaving it steady at 35.8120 against the central bank’s target dollar-euro basket.

Urals rose 0.3 percent to a seven-week intraday high of $111.56 per barrel. Russia, the world’s biggest oil producer, will need the commodity to trade at an average $125 a barrel in 2012 to balance its budget, according to finance ministry estimates.

“There’s macroeconomic factors like the oil price” and the European debt crisis moving the market, Peter Szopo, head of research at Alfa Bank, said by telephone.

German Chancellor Angela Merkel and French President Nicolas Sarkozy meet for the first time this year today to flesh out a new rulebook for fiscal discipline negotiated at a Dec. 9 summit that seeks to create a “fiscal compact” for the 17- member euro area. The European Union is Russia’s largest trading partner.

Russia’s markets are open during the country’s New Year holidays until Jan. 10. The ruble first traded against the dollar on the Micex exchange at 10:12 a.m. in Moscow today, according to data compiled by Bloomberg, 12 minutes after the market opened. The first trade against the euro came at 11:08 a.m.

“It makes sense from a trading point of view to have the markets open, as London is trading,” Szopo said.

Investors pared bets the ruble would weaken, with non- deliverable forwards showing the Russian currency at 32.2838 per dollar in three months. Russia’s 140 billion rubles of domestic bonds due August 2016 fell, pushing the yield up one basis point, or 0.01 percentage point, to 8.15 percent.

--Editors: Hellmuth Tromm, Ash Kumar

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 -0- Jan/09/2012 10:08 GMT


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