Bloomberg News

Ruble Strengthens Second Day to Dollar Before Tax Payments

November 20, 2012

The ruble appreciated for a second day as exporters bought the currency to pay local taxes and as euro-area finance ministers prepared to discuss Greece’s finances.

The ruble appreciated 0.6 percent to 31.2875 against the dollar by 4:07 p.m. in Moscow. It climbed 0.4 percent versus the euro to 40.0950 and added 0.5 percent against the central bank’s euro-dollar target basket.

Domestic companies are converting dollar revenue to pay about 250 billion rubles ($8 billion) of value-added tax this week, according to ZAO Citibank in Moscow. Euro-area finance ministers meet in Brussels today to try and plug a 15 billion- euro ($19 billion) hole in Greece’s finances and win over support from the International Monetary Fund. Europe is Russia’s biggest trade partner.

“Risk aversion is lower” on speculation a Greek deal will be reached, Olga Ponomarenko, an economist at Citibank, said by e-mail.

Non-deliverable forwards showed the ruble at 31.8345 per dollar in three months compared with 31.9400 yesterday.

The extra yield investors demand to own Russia’s dollar bonds over U.S. Treasuries fell two basis points to 199, according to JPMorgan Chase & Co.’s EMBI Global Index. An index of five-year government bond yields was little changed at 6.9705 percent after tumbling seven basis points yesterday, the most in more than a week.

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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