Nov. 7 (Bloomberg) -- Russia’s ruble strengthened the most in almost four months after the European Central Bank unexpectedly cut its main rate to a record low.
The ruble advanced 0.7 percent to 37.2624 against Bank Rossii’s target dollar-euro basket by 6 p.m. in Moscow, when the central bank stops its market operations. The currency weakened 0.1 percent against the dollar to 32.4060, while gaining 1.4 percent against the euro to 43.2065.
ECB President Mario Draghi pledged to keep borrowing costs low in Russia’s biggest trade partner for an “extended period.” That decision bolstered appetite for the ruble and offset concern the U.S. may pare stimulus after better-than-forecast economic data today, according to Vladimir Miklashevsky at Danske Bank A/S.
“The ECB decision outweighed the U.S. economic growth data,” Miklashevsky, a strategist in Helsinki, said in e-mailed comments. “Unless the tapering starts, the ruble is winning.”
The yield on government bonds due February 2027 declined one basis point, or 0.01 percentage point, to 7.63 percent. Oil fell 1.1 percent to $104.14 a barrel in London, extending its decline for a third day.
Russian gross domestic product will rise at an average pace of 2.5 percent through 2030, less than the 3.4 percent to 3.5 percent global rate, documents provided today by the Economy Ministry showed. The Russian economy is forecast to expand 1.9 percent this year before growth accelerates to an average pace of 2.8 percent in 2014, according to the median estimate of 38 economists in a Bloomberg survey.
“It’s hard to call for a sustained rally in the ruble on this news,” Miklashevsky said. “Russian GDP is well below the U.S., and people will keep this macro in mind.”
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