The ruble snapped four days of declines and yields on Russia’s international debt fell as oil, the country’s main export, advanced and tax payments boosted the currency.
The Russian currency appreciated 1.2 percent to 32.92 per dollar by the close in Moscow, the biggest gain since June 6, paring its quarterly depreciation to 12%. The country’s $3.5 billion of Eurobonds due 2020 rose, lowering the yield by 13 basis points, or 0.13 percentage point, to 3.778 percent.
Brent crude advanced for a third day, up 0.3 percent to $91.36 per barrel, set for the highest closing price since June 20. Oil and gas make up about 50 percent of Russia’s state revenue, according to the government’s estimates. The ruble is being temporarily supported as exporters convert revenue from abroad to pay monthly taxes, according to Igor Akinshin, a currency trader at Alfa Bank in Moscow.
“Backed by rising oil, the ruble is appreciating modestly,” Peter Neimyshev, head of foreign exchange at Otkritie Bank in Moscow, said by e-mail. The currency may appreciate a further 1.1 percent before correcting, he said and added the European “situation is far from stable.”
The ruble gained 1.3 percent to 41.055 per euro and 1.2 percent to 36.5808 against the central bank’s target dollar-euro basket. Investors pared bets on the currency weakening, with non-deliverable forwards showing the ruble at 33.4896 per dollar in three months, compared with expectations of 33.8195 per dollar yesterday.
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