Ruble Drops 2nd Day as Tax Period Ends, Bank Rossii Pumps Cash
The ruble weakened for a second day as companies wound down local currency purchases to pay taxes and the central bank pumped funds into banks.
The ruble retreated less than 0.1 percent against Bank Rossii’s dollar-euro basket to 35.5047 and declined 0.1 percent versus the dollar to 31.3905 by 6 p.m. in Moscow. The yield on benchmark OFZ bonds due February 2027 increased one basis point, or 0.01 percentage point, to 7.22 percent
The monthly tax period, which traditionally supports the ruble, concludes today with payment of corporate income tax. The central bank offered 2.08 trillion rubles ($66 billion) in seven-day repo funds today, matching its largest offering.
“Bank Rossii has been providing enough liquidity,” Vladimir Miklashevsky, an economist and trading strategist at Danske Bank A/S (DANSKE), said today. “There’s been no serious pressure for the ruble to strengthen too much.”
Brent oil gained 1.8 percent to $104.48 per barrel. Oil and natural-gas industries contribute about half of Russia’s budget revenue.
“The oil price has had less impact since last year,” Miklashevsky said. “Since the Cyprus woes, the ruble rate has been more dependent on demand, for example, tax payments or some large deals in the debt or the stock market.”
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