MOSCOW: The Russian rouble gained on Thursday as oil prices rose and the market got ready for an interest rate cut by the Bank of Russia.
Prices for oil, Russia’s key export, rose to a six-week high on Wednesday, closing in on January’s three-year peak, on a surprise decline in US inventories, strong compliance on OPEC production cuts, and persistent concern related to the Iran nuclear deal.
The rouble was 0.2 percent stronger at 56.77 versus the dollar as of 0745 GMT, a level last seen on March 14.
The rouble and oil got a boost from a slide in the dollar after the Federal Reserve raised US rates, as expected, and forecast at least two more rate increases this year .
Now the Russian central bank is in the market’s focus. It is expected to cut its key rate from 7.5 percent as soon as this Friday.
A mixed set of economic data support the need for lower rates to prop up economic recovery amid record-low inflation, analysts said.
Month-end taxes should limit possible losses in the rouble over the next week as spikes in foreign currency rates are usually used by Russian export-focused companies to convert dollars in order to meet local liabilities.
Against the euro, the rouble eased 0.05 percent to 70.23 .
Benchmark stock indexes were mixed after rising for two days in a row. The dollar-denominated RTS index climbed 0.6 percent to 1,277.8 points, while its rouble-based peer MOEX was 0.3 percent lower at 2,302.8 points.
Source: Brecorder.com
