Ruble Cimbs Against Central Bank Basket on Tax as Oil Pares Loss

The ruble strengthened against Bank Rossii’s target basket as companies bought the local currency to pay taxes and oil pared declines.

The ruble climbed 0.2 percent against Bank Rossii’s basket of dollars and euros to 35.4637 by 1:48 p.m. in Moscow and advanced 0.2 percent against the dollar to 31.3975, snapping two days of declines. Yields on benchmark OFZs due February 2027 were unchanged at 6.95 percent.

The monthly tax period continues May 20 with excise and value-added tax payments. Brent oil traded down 0.1 percent at $103.57 per barrel in London, paring a retreat of as much as 0.7 percent. Oil and natural gas contribute about half of Russia’s budget revenue.

“Recovering oil prices and approaching taxes will support the ruble today,” OAO Rosbank (ROSB) analysts led by Vladimir Kolychev said in an e-mailed note.

Bank Rossii kept its main interest rates unchanged for an eighth month yesterday, as forecast by 18 out 24 economists surveyed by Bloomberg. The regulator reduced some mid-term and long-term rates on refinancing, backed by gold and non-marketable assets, by 25 basis points.

“The expected rates decision hasn’t changed the balance on the ruble market,” the Rosbank analysts said.

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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