Bloomberg News

Ruble Gains 3rd Day as Companies Buy Russian Currency

November 21, 2012

(Corrects headline to say currency bought was rubles.)

The ruble strengthened for a third day as companies bought the currency to pay taxes, offsetting earlier losses that resulted from a paring of risk appetite after European officials failed to agree on a debt-reduction package for Greece.

The ruble appreciated 0.3 percent against the dollar to 31.2100 by 3:42 p.m. in Moscow, after falling as much as 0.5 percent. It gained 0.4 percent versus the euro to 39.9507 and added 0.4 percent against the central bank’s euro-dollar target basket.

The beginning of the tax period “offers considerable support for the national currency,” Alexei Egorov, an analyst at Moscow-based OAO Nomos Bank, said by e-mail. The ruble had weakened after “the issue of granting Greece a new tranche of financial aid remained open,” Egorov said.

Companies are buying the ruble ahead of payouts to the government next week including mineral extraction and profit taxes, which Egorov estimates at about 400 billion rubles ($12.8 billion). With creditors led by Germany refusing to put up fresh money or offer debt relief, the finance chiefs were unable to scrape together enough funds from other sources to help alleviate Greece’s debt burden, set to hit 190 percent of gross domestic product in 2014. Europe is Russia’s main trade partner.

Non-deliverable forwards showed the ruble at 31.7253 per dollar in three months compared with 31.7615 yesterday.

The extra yield investors demand to own Russia’s dollar bonds over U.S. Treasuries dropped one basis point to 194, according to JPMorgan Chase & Co.’s EMBI Global Index. An index of five-year government bond yields fell 17 basis points to 6.7848 percent.

To contact the reporter on this story: Lyubov Pronina in London at

To contact the editor responsible for this story: Gavin Serkin at

Steve Ballmer, Power Forward
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