The ruble strengthened for the first time in three days as a U.S. presidential victory for Barack Obama boosted appetite for riskier assets.
The ruble rose 0.1 percent to 31.46 per dollar by the 7 p.m. close in Moscow. The currency strengthened 0.6 percent to 40.1175 versus the euro and gained 0.3 percent versus the central bank’s euro-dollar basket.
Bond purchases under Federal Reserve Chairman Ben Bernanke have swelled the amount of dollars on the market, supporting crude oil’s 129 percent rally since Obama took office in January 2009. An Obama win will stoke Russian stock gains as he has a “more constructive” view of relations with Russia than Republican challenger Mitt Romney, East Capital, which manages about $2.4 billion of Russian assets, said yesterday.
“Obama’s victory brought certainty to the markets,” Sergey Kucherenko, who manages about $50 million in Russian equities at Nomos Bank in Moscow, said by phone today. At the same time, there are still “many unresolved issues” including the U.S. budget deficit, he said.
Russia sold 33.4 billion rubles ($1.1 billion) of 10-year bonds at an average yield of 7.42 percent today, its lowest rate on record for that maturity and 37 basis points below the yield at the last sale on Oct. 10.
“Investors expect Obama to continue with his monetary easing policies, which will help maintain a weaker dollar and stronger oil prices,” Aleksei Belkin, who manages about $350 million as the head of asset management at Kapital LLC, said by phone from Moscow.
Bank Rossii plans to review interest rates on Nov. 9. The regulator will probably leave the refinancing rate on hold at 8.25 percent, according to a median estimate of 23 economists surveyed by Bloomberg.
Non-deliverable forwards showed the ruble at 31.9411 per dollar in three months.
The extra yield investors demand to own Russia’s dollar bonds over U.S. Treasuries rose seven basis points to 189, according to JPMorgan Chase & Co.’s EMBI Global Index.
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