Ruble Rises for 4th Day as ECB Bond Plan Boosts Risk Appetite

The ruble strengthened for a fourth day, erasing earlier declines against the dollar, on rising appetite for riskier assets after the European Central Bank announced its bond-buying program.

The ruble rose 0.8 percent to 31.6973 per dollar at 7 p.m. in Moscow, its longest stretch of gains in seven weeks. The ruble weakened 0.6 percent versus the euro at 40.5400, leaving it less than 0.1 percent stronger against the central bank’s target euro-dollar basket.

ECB President Mario Draghi said yesterday policy makers agreed to an unlimited bond-purchase program to lower borrowing costs for struggling economies. Brent crude rose 0.5 percent to $114.07 per barrel today, increasing for a second day. Oil and natural gas account for about 50 percent of Russia’s state revenue.

“The ruble continues to appreciate on the back of external markets,” Igor Akinshin, a Moscow-based currency trader at Alfa Bank said by phone. “The markets heard from Draghi what they wanted to hear.”

Non-deliverable forwards showed the ruble at 32.1675 per dollar in three months against 32.3955 yesterday.

The extra yield investors demand to own Russia’s dollar bonds over U.S. Treasuries rose 1 basis point to 207, according to JPMorgan Chase & Co.’s EMBI Global Index. An index of five- year government bond yields compiled by the Micex fell 5 basis points to 7.472 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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