Ruble Slides First Time in Four Days as Crude Oil Retreats

The ruble slid for the first time in four days as crude oil, Russia’s main export earner, retreated.

The ruble weakened 0.7 percent to 31.4690 per dollar, leaving it down 0.2 percent in the week as of the 7 p.m. close of trading in Moscow. The currency rose 0.3 percent to 40.4099 versus the euro and fell 0.2 percent to 35.4924 versus the central bank’s euro-dollar basket.

Oil dropped as much as 1.8 percent to $85.27 a barrel in New York as two refineries remained shut on the U.S. East coast in the aftermath of Hurricane Sandy. Crude and natural gas account for about 50 percent of Russia’s state revenue.

“This morning’s selloff in the ruble was trigged by falling oil prices,” said Anton Zakharov, a senior currency and commodities analyst at Promsvyazbank, said by e-mail today. At the same time, “the technical picture for the ruble hasn’t changed, and it’s likely to continue trading against the dollar in the short term in the range of 31.17 to 31.51.”

The ruble is down 7.9 percent from this year’s peak of 28.9925 versus the dollar on March 26 when oil traded just $2.74 from the high of $109.77 a barrel, data compiled by Bloomberg show. Russia’s currency lost 1.8 percent last week, the biggest weekly decline since June.

Bank Rossii will review interest rates on Nov. 9, the central bank said today. The regulator is likely to leave the refinancing rate on hold at 8.25 percent, according to a median estimate of 19 economists surveyed by Bloomberg.

Non-deliverable forwards showed the ruble at 31.9425 per dollar in three months.

The extra yield investors demand to own Russia’s dollar bonds over U.S. Treasuries dropped three basis points to 186, according to JPMorgan Chase & Co.’s EMBI Global Index. An index of five-year government bond yields fell three basis points to 7.0617 percent.

To contact the reporters on this story: Alex Nicholson in Moscow at anicholson6@bloomberg.net; Scott Rose in Moscow at rrose10@bloomberg.net

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

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