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Ruble Gains 5th Day as Risk Appetite Rises on China, Syria Plan

Sept. 10 (Bloomberg) -- The ruble gained for a fifth day as Chinese economic data improved and a Russian proposal for Syria to surrender its chemical weapons eased concern over a U.S. strike, boosting investor appetite for riskier assets.

The currency of the world’s biggest energy exporter advanced 0.5 percent against Bank Rossii’s target basket of dollars and euros to 37.8173, the highest level since Aug. 9 on a closing basis. The yield on government bonds due February 2027 rose one basis point, or 0.01 percentage point, to 7.89 percent.

China’s industrial output increased 10.4 percent in August from a year earlier and retail sales gained 13.4 percent, the National Bureau of Statistics said today. France said it will submit a Russian-backed plan to confiscate Syria’s chemical weapons to the United Nations, as Interfax reported that Bashar al-Assad’s government accepted the proposal.

“Good numbers from China and on top of that the market liked” Russia’s Syria plan, Vladimir Miklashevsky, trading desk strategist at Danske Bank A/S in Helsinki, said in e-mailed comments. “Full risk-on today.”

The ruble strengthened 0.6 percent against the dollar to 32.9850 by 6 p.m. in Moscow, when the central bank stops its open market transactions. It advanced 0.4 percent against the euro to 43.7235.

JPMorgan Chase & Co.’s Emerging Markets Currencies Index rose 0.4 percent to 89.37, a three-week high. Brent oil slid 2 percent to $111.49 per barrel.

The central bank moved toward a free-floating ruble exchange rate yesterday by lowering the amount of accumulated interventions required to shift the currency’s trading band.

‘This decision removes the risk for band widening in the near future’’ and is positive for the ruble, VTB Capital analysts Maxim Korovin and Anton Nikitin said in an e-mailed note. They recommended betting the ruble will strengthen to 37.50 against the basket.

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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