Breaking News

Tweet TWEET

Ruble Retreats Versus Basket as Oil Drops, Tax Period Winds Down

The ruble weakened as crude oil prices declined and the tax period wound down, curbing demand for the local currency from exporters.

The ruble depreciated 0.5 percent against Bank Rossii’s target basket of dollars and euros to 35.5636 by 2:22 p.m. in Moscow, paring its gain in the week to 1.4 percent. It fell 0.5 percent versus the dollar to 31.3215.

Crude slid 0.6 percent in London to $102.79 per barrel. Oil and natural gas contribute about 50 percent of Russia’s budget revenue. The last tax payments this month are due April 29.

“As the tax period ends, the ruble has no chance for growth next week,” Anton Zakharov, analyst at OAO Promsvyazbank, said by e-mail.

The currency should trade at 36 rubles to the basket when Brent is at $100 per barrel, BCS Financial Group analysts led by Leonid Ignatiev said in an e-mailed report.

Bank Rossii said it spent the equivalent of 2.22 billion rubles selling foreign currency and buying rubles on the market on April 24. Today’s decline pushed the ruble toward 35.65 to the basket, the level at which the central bank may intervene to support the currency. Bank Rossii intervened daily from April 15, selling the equivalent of about 2.2 billion rubles of foreign currency per day.

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

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.