Rouble weakens past 59 vs dollar, falls back sharply vs euro


This content was produced in Russia where the law restricts coverage of Russian military operations in Ukraine

By Alexander Marrow and Caleb Davis

MOSCOW, Oct 4 (Reuters) - The rouble weakened past 59 against the dollar on Tuesday and slumped against the euro, giving up most of the previous session's gains, as concerns over possible new sanctions against Moscow continued to buffet the Russian currency.

The rouble has experienced significant swings in recent sessions, hampered by limited liquidity and investors' concerns that any new sanctions over Russia's actions in Ukraine could restrict access to foreign currency in Moscow.

By 1509 GMT, the rouble RUBUTSTN=MCX was 0.6% weaker against the dollar at 59.23​ and had lost 5.3% to trade at 56.42 versus the euro EURRUBTN=MCX . It had firmed 0.2% against the yuan to 8.25 CNYRUBTOM=MCX .

"The accounts of many Russian companies in Europe are at risk of being frozen, either by the European Union as part of a new sanctions package, or by local authorities," said Otkritie Research in a note.

Poland froze the assets of Gazprom Export, a unit of Russian energy giant Gazprom GAZP.MM , last week.

The rouble may come under pressure amid a low supply of foreign currency by exporters, said chief analyst Bogdan Zvarich.

A month-end tax period that usually sees export-focused firms convert FX revenues to meet local liabilities ended last week.

The rouble moved lower after Russia's finance ministry cancelled Wednesday's OFZ bond auction, citing financial market volatility. Yields on Russia's benchmark 10-year OFZ treasury bond RU10YT=RR hit their lowest since Sept. 19 of 9.71% before climbing back up to 9.81%.

Yields move inversely to their price.

Russian stock indexes, supported late last week by Gazprom approving interim dividends, pared earlier gains to slip back.

"The liquidity factor should give a further boost to the markets as money from Gazprom dividends flows to the market," said BCS Global Market.

The dollar-denominated RTS index .IRTS was down 0.6% at 1,085.9 points, while the rouble-based MOEX Russian index .IMOEX was unchanged at 2,041.4 points, after earlier reaching its strongest since Sept. 23.

Brent crude oil LCOc1 , a global benchmark for Russia's main export, rose 3.4% to $91.9 a barrel amid expectations producer group OPEC+ could agree to large output cuts this week.

SPB Exchange SPBE.SBX , Russia's second-largest bourse which specialises in foreign shares, said on Tuesday it would start trading of four Chinese companies listed on the Hong Kong Stock Exchange from Oct. 5.​
Reporting by Caleb Davis and Alexander Marrow; Editing by Ed Osmond, Mark Potter and Maju Samuel

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.