Ruble Gains Most in Eastern Europe as Crude Rebounds Above $50

  • Currency rises after falling the most in a month on Wednesday
  • Oil supports ruble as markets await U.K. referendum: Aljba

The ruble led an advance among emerging-market peers in Eastern Europe and bonds rose as oil traded above $50 a barrel against the backdrop of the U.K.’s referendum on membership in the European Union.

The Russian currency rose 0.9 percent to 64.30 against the dollar by 6:20 p.m. in Moscow as Britons headed to the polls. Brent crude, the benchmark used to price the country’s main export blend, gained 0.4 percent to $50.06 a barrel in London. Bonds advanced for a second day, with yields remaining at a two-year low.

Oil’s 36 percent rally this year is underpinning a recovery in Russia’s economy, which economists project will emerge from a two-year recession by the fourth quarter. The ruble was the third-best performer among 24 emerging-market peers after two polls conducted before Thursday showed a lead for the campaign to keep Britain in the European Union.

“Oil is supporting the ruble today,” Artem Roschin, a currency trader at Aljba Alliance LLC in Moscow, said by phone. “The market is really nervous over the U.K. referendum.”

Referendum’s Effects

The outcome of the U.K. vote is being watched around the world after warnings by the U.K.Treasury, the International Monetary Fund and others that a so-called Brexit risked jobs, incomes, a plunge in the pound and damage to the U.K. economy. That’s a prospect that threatens to roil global markets and buttress anti-establishment movements in other EU members.

To sign up for Bloomberg’s live blog of the U.K. referendum, click here.

The ruble fell the most in a month on Wednesday as oil declined following data showing U.S. crude stockpiles shrank less than expected last week. Sales of oil and natural gas account for about a third of Russia’s budget revenue.

The Russian currency is also being supported by exporters buying rubles to pay monthly taxes, according to Denis Davydov, an analyst at Nordea Bank in Moscow. Russian companies have about 869 billion rubles ($13.5 billion) in monthly taxes to pay on June 27 and June 28, according to Sberbank CIB.

A vote to remain in the EU would “boost risk sentiment” and the ruble could “benefit strongly,” targeting 63 per dollar, Sberbank CIB analysts said Thursday in an e-mailed report.

The Micex Index of shares rose 0.8 percent while five-year bonds advanced, cutting the yield to 8.76 percent, the lowest since July 2014.

Before it's here, it's on the Bloomberg Terminal.