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Ruble Snaps Three Days of Declines as Crude Gains on U.S. Budget

Dec. 18 (Bloomberg) -- The ruble snapped three days of declines as crude oil, Russia’s biggest export earner, advanced.

The ruble added 0.3 percent against the dollar to 30.8545 by the close in Moscow. It gained 0.3 percent versus the euro to 40.6725 and added the same amount to 35.2726 against the central bank’s target euro-dollar basket. An index of five-year government bond yields compiled by the Micex rose nine basis points to 6.5776 percent.

Crude climbed 0.5 percent to $87.67 a barrel in New York on speculation an agreement will be reached to avert a U.S. budget impasse that would trigger automatic spending cuts and tax increases next year, sapping demand for fuels. Russia is the world’s biggest energy exporter and oil and natural gas account for about 50 percent of the nation’s government revenue.

“I see the positives dominating today,” Vladimir Pantyushin, chief economist at Barclays Plc’s investment-banking unit in Moscow, said by e-mail. “The oil price and the Micex are up, so the ruble correction is quite natural.”

Non-deliverable forwards showed the ruble at 31.3105 per dollar in three months. The extra yield investors demand to own Russia’s dollar bonds over U.S. Treasuries fell five basis points to 166, JPMorgan Chase & Co.’s EMBI Global Index shows.

The ruble slumped 1.1 percent against the dollar in the previous three days as importers of consumer goods bought foreign currency during the year’s busiest shopping season. The average Russian plans to spend the equivalent of $504 on presents, parties and entertainment during the year-end holidays, a 9 percent increase from the year before, the Vedomosti newspaper reported on Dec. 4, citing a survey by Deloitte.

To contact the reporter on this story: Maria Levitov in London at mlevitov@bloomberg.net

To contact the editor responsible for this story: Gavin Serkin at gserkin@bloomberg.net

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