Ruble Strengthens Against Bank Rossii Basket on Oil Gains, Taxes

The ruble pared last week’s slump as oil rose for a third day and the need to settle taxes spurred demand for the Russian currency from exporters.

The ruble appreciated 0.3 percent against the dollar-euro basket to 35.9386 by 2:16 p.m. in Moscow after a 1.9 percent drop last week. The central bank targets the basket to smooth fluctuations that can hurt exporter competitiveness. The ruble strengthened 0.2 percent against the dollar to 31.6000.

Brent oil gained for a third day in London, rising 1 percent to $100.67 per barrel. Revenue from sales of crude and natural gas comprise about 50 percent of Russia’s state budget income. Russian companies are due to pay 200 billion rubles ($6.3 billion) in taxes today and 200 billion rubles on April 25, Vladimir Osakovskiy, chief economist for Russia at Bank of America Corp., said by e-mail.

“Active selling of export revenue will more than compensate the negative pressure on the ruble,” OAO Rosbank (ROSB) analysts led by Vladimir Kolychev wrote in a note to clients.

The ruble continued to trade weaker than 35.65 to the basket, the level beyond which the central bank spends about $70 million a day to curb declines, according to traders. Bank Rossii reported it sold the equivalent of 2.2 billion rubles ($70 million) in foreign currency on April 18, the regulator said today on its website.

The yield on benchmark OFZ bonds due February 2027 rose two basis points, or 0.02 percentage point, to 7.03 percent.

To contact the reporter on this story: Vladimir Kuznetsov in Moscow at vkuznetsov2@bloomberg.net

To contact the editor responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.net

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