(Reuters) – The Russian rouble rose further in early Moscow trading on Thursday, aided by higher foreign currency conversion into roubles as a result of month-end tax payments, while market indices rose significantly.
The Russian market is somewhat artificial, since the rouble is supported by capital restrictions, while stocks are traded with a prohibition on short selling and foreign investors are prohibited from selling their shares in Russian enterprises without authorization.
At 0737 GMT, the rouble was 0.3 percent stronger against the dollar, trading at 72.59 per dollar, having reached 72 in light trading on the Moscow Exchange.It peaked at 74.3525 per euro, a level not seen since early March 2020, before falling 0.5 percent to 75.75.
According to Promsvyazbank analysts in a note, the Russian ruble is projected to fluctuate between 71 and 73 to the dollar.
Companies that export sell their foreign currency earnings to pay domestic debts that could reach 3 trillion roubles ($41.24 billion) this month. The rouble has been getting stronger in recent days because export-oriented businesses have been selling their foreign currency earnings to pay their debts.
The rouble has entirely returned to levels reached before Feb. 24, when Russia began what it refers to as a “special military operation” in Ukraine, prompting unprecedented western penalties, including a freeze on Russia’s reserves.
In the bond market, rates on benchmark 10-year OFZ government bonds have stabilised at around 10.13 percent ahead of Friday’s central bank rate-setting meeting.
People who took part in a Reuters poll this week say that the Bank of Russia is likely to cut its main interest rate by 200 points to 15% in order to encourage lending in the economy, where inflation is too high.
The Russian stock market indices were higher. The dollar-denominated RTS index increased by 2.2 percent, reaching 1.072.0 points, while the rouble-denominated MOEX index increased by 1.9 percent, to 2,470.7 points.
For a guide to Russian stocks, see
For information on Russian government bonds, see
(1 dollar equals 72.7410 roubles)
