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Ruble Strengthens to Two-Month High on Tax Payments, Summers

Sept. 16 (Bloomberg) -- The ruble climbed to the strongest level in almost two months, buoyed by monthly tax payments and rising appetite for emerging-market assets.

The currency advanced 0.5 percent against Bank Rossii’s target basket of dollars and euros to 37.1294 by 6 p.m. in Moscow, the ninth day of gains. The yield on 10-year government bonds declined by 14 basis points, or 0.14 percentage point, to 7.29 percent.

The tax period, which lasts until the end of the month and increases demand for rubles from exporting companies, started today with mandatory transfers to pension and insurance funds. Lawrence Summers, a former U.S. Treasury secretary, withdrew from the race to lead the Federal Reserve, ending bets he would undo the central bank’s policies aimed at holding down borrowing costs. JPMorgan Chase & Co.’s Emerging Markets Currencies Index rose 0.9 percent to 90.248, the highest since August 12.

“Exporters are driving preparations for the tax period,” OAO Rosbank analysts led by Vladimir Kolychev said in an e-mailed note.

Russian companies will pay about 1.12 trillion rubles ($35 billion) of tax this month with 370 billion rubles, the largest payment, for mineral extraction levies due Sept. 25, Anton Nikitin, an analyst at VTB Capital in Moscow, said in e-mailed comments.

The currency of the world’s biggest energy exporter advanced 0.2 percent versus the euro to 43.1010 and 0.7 percent against the dollar to 32.2425. The ruble has gained 3.7 percent against the dollar since Sept. 5, the fifth-best result among 24 developing-nation peers tracked by Bloomberg.

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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