Bloomberg News

Ruble Extends Longest Winning Streak in 2 Months on Tax Payouts

November 26, 2012

The ruble rose for a sixth day against the dollar, the longest rally since September, as companies bought the Russian currency to pay taxes.

The ruble appreciated 0.1 percent to 31.0225 per dollar by 1:04 p.m. in Moscow. The currency added 2.1 percent last week, the strongest weekly gain since Sept. 16. It was little changed against the central bank’s euro-dollar target basket and against the euro at 40.1820.

Companies need about 450 billion rubles ($14.5 billion) to pay mineral extraction, excise and profit taxes this week, according to ING Groep NV. Euro-area finance ministers are meeting in Brussels today on an updated Greek aid package.

The ruble may strengthen further and break through the level of 31 rubles to the dollar, Dmitry Polevoy, a Moscow-based economist at ING, said in an e-mailed note today. “If European politicians do not disappoint, this movement can happen today.”

Non-deliverable forwards showed the ruble at 31.4850 per dollar in three months compared with 31.4635 on Nov. 23.

The extra yield investors demand to own Russia’s dollar bonds over U.S. Treasuries rose two basis points to 195, according to JPMorgan Chase & Co.’s EMBI Global Index. An index of five-year government bond yields rose three basis points to 6.7096 percent.

To contact the reporter on this story: Lyubov Pronina in London at lpronina@bloomberg.net

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


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