Ruble Strengthens as Yields Steady on Crude Oil Advance, Taxes

The ruble strengthened, extending last week’s gains, as crude rallied and companies paid mineral extraction taxes.

The currency rose 0.2 percent versus the dollar to 32.251 by 1:23 p.m. in Moscow after a 1 percent advance last week. The yield on benchmark OFZ bonds due February 2027 was steady at 7.58 percent.

Oil, Russia’s main export earner, rose for a fourth day, adding 0.4 percent to $108.44 per barrel in New York. The tax period in the world’s biggest energy exporter continues until the end of the week. The payments support the currency as companies convert export revenue into rubles.

“Taxes along with strong oil continue to support the ruble,” Alexander Muhlberger, head of foreign-exchange trading at BCS Financial Group, said by phone from Moscow. “Taxes are a major factor for the Russian currency.”

The ruble climbed last 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 36.857 against the dollar-euro basket and 42.4695 against the euro. JPMorgan Chase & Co.’s Emerging Currencies Index climbed 0.2 percent to 91.38.

To contact the reporter on this story: Ksenia Galouchko in Moscow at kgalouchko1@bloomberg.net

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

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