Ruble Extends Second Weekly Gain Amid Oil Rally, Tax Payments

The ruble strengthened against the dollar, heading for a second week of gains, as Brent crude rallied and companies paid local taxes.

The ruble rose 0.3 percent versus the dollar to 32.3900 by 2:56 p.m. in Moscow, gaining 0.8 percent in the week. The yield on benchmark OFZ bonds due February 2027 declined one basis point, or 0.01 percentage point, to 7.59 percent, a 16 basis-point decline in the week.

Brent for September delivery rose for a sixth day, adding 0.3 percent to $108.99 per barrel, the highest since April 2. The tax period in the world’s biggest energy exporter continues July 22. The payments support the currency as companies convert export revenue into rubles.

“Normally the July period is one of the largest for tax payments” at about 1.1 trillion rubles ($34 billion), or about 100 billion rubles more than in June, Vladimir Miklashevsky, a trading desk strategist at Danske Bank A/S (DANSKE) in Helsinki, said in e-mailed comments.

The ruble climbed this week as investors speculated that the Federal Reserve will keep stimulus measures in place, boosting appetite for riskier, emerging-market assets. Chairman Ben S. Bernanke told lawmakers that the central bank’s $85 billion of monthly bond purchases “could be reduced more quickly or expanded” depending on the pace of recovery in the U.S.

The ruble was little changed at 36.9194 against the dollar-euro basket and advanced 0.1 percent to 42.43 against the euro. JPMorgan’s Emerging Currencies Index declined 0.1 percent to 91.34.

In the coming weeks the ruble will “depend mostly on the Fed’s tapering expectations, which will be influenced by U.S. labor statistics,” Miklashevsky said. “What is bad for the U.S. economy will be good for the ruble.”

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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