Tuesday, 10 November 2015 13:14
MOSCOW: The Russian rouble rose early on Tuesday as emerging market currencies recovered following steep falls late last week, but analysts said the rouble’s fate would probably remain tied to oil in the near term.
At 0738 GMT, the rouble was 0.3 percent stronger against the dollar at 64.41 and had gained 0.3 percent to trade at 69.24 versus the euro.
Brent crude oil, a global benchmark for Russia’s main export, was up 0.1 percent at $ 47.2 a barrel.
“Oil volatility is to remain the key driver for the rouble in the near term,” Maxim Korovin, forex analyst at VTB Capital, said in a note.
Pyotr Neimyshev, a currency dealer at Otkritie bank, said the rouble was probably being helped on Tuesday by traders positioning for a rise in oil prices.
Demand for foreign currency is modest as foreign debt repayments in November are slight, he added.
The Russian currency slipped slightly on Monday but fell steeply on Friday, when US labour statistics caused global markets to position for the Federal Reserve to increase interest rates in December.
Higher interest rates in the United States are negative for emerging markets such as Russia because they increase the returns on lower-risk dollar-denominated instruments.
They also tend to boost the dollar, which is negative for global oil prices.
Russian share indexes fell on Tuesday, in line with moves on global markets linked to the prospect of higher borrowing costs in the United States and slower global economic growth.
The dollar-denominated RTS index was down 0.4 percent to 852 points, while the rouble-based MICEX was 0.5 percent lower at 1,742 points.
