Hedge Funds Turn Bearish on the Ruble First Time Since December

Ruble CFTC Futures

Hedge funds started betting on a weaker ruble for the first time in more than seven months after the Russian currency slid for a fourth week amid rate cuts and foreign-currency purchases by the central bank.

Speculators were net short the ruble by 2,001 futures in the week ended July 14, the first time they were bearish since the week ended Dec. 9, according to U.S. Commodity Futures Trading Commission data published Friday. The ruble weakened 1 percent last week, taking its decline since mid-May, when the Bank of Russia began buying foreign exchange, to 13 percent.

Russia’s currency has also weakened as companies seek dollars and euros to repay international debt and the price of oil, the nation’s largest export, slides on expectation that Iran will increase production as sanctions are lifted. The ruble remains 6.7 percent stronger this year, the most among emerging markets, after rebounding from a record low in December.

“The outlook for the ruble deteriorated since the beginning of July due to further decline in oil prices from the year-to-date high,” Piotr Matys, a London-based foreign-exchange strategist at Rabobank, said by e-mail.

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