MOSCOW: The Russian rouble firmed to almost two week highs thanks to strong oil prices and month-end tax payments.
At 0747 GMT, the rouble was 0.64 percent stronger against the dollar at 65.70, the level seen last time on Oct. 3, and had gained 0.53 percent to trade at 76.02 versus the euro.
Oil prices rose as pressure on Saudi Arabia, the world’s top oil exporter, over the disappearance of a prominent Saudi journalist stoked worries about supply.
Brent crude oil, a global benchmark for Russia’s main export, was up 0.53 percent at $80.86 a barrel.
The Russian currency was also supported by local tax payments for the month of October which came due on Monday. To meet these duties export-focused companies usually convert their foreign currency revenues into roubles.
According to a Reuters poll, tax payments could reach 2.2 trillion roubles ($33.49 billion) this month.
“Taking into account the morning recovery of oil prices and the relative stability of emerging market currencies, it can be assumed that the rouble may continue to strengthen,” Vasily Karpunin from BCS brokerage said in a note.
He said they expected the Russian currency to trade within a range of 65-65.5 per dollar.
Possible sanctions from Western countries against Russia were still a risk for the Russian market. At a meeting in Luxembourg on Monday, the European Union Council is expected to consider a document outlining new sanctions against Russia, which it accuses of attempting to kill former spy Sergei Skripal with a nerve agent in the English city of Salisbury and chemical attacks in Syria. Russia denies the allegations.
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Source: Brecorder
