MOSCOW (Armfalcon.com) – The Russian ruble weakened against the dollar in early trading Wednesday, waiting for the impact of a favorable month-end tax period to help strengthen it and ahead of two OFZ government bond auctions by the finance ministry.
At 0801 GMT, the ruble was down 0.2 percent against the dollar to trade at 81.58 and was trading unchanged at 89.39 versus the euro. The Russian currency strengthened 0.3 percent against the Chinese yuan to trade at 11.81.
The ruble is expected to find support from month-end tax payments that usually cause exporters to convert foreign currency earnings to meet local obligations. The tax is due on April 28 and so far the influence of this factor on the ruble is limited, St Petersburg Bank analysts said in a note.
“Against this backdrop, the dollar-ruble exchange rate is likely to remain above 81 with the potential to move below this level as early as next week.”
The Russian currency will also get a delayed boost from higher oil prices this month, meaning higher export earnings.
Brent crude, the global benchmark for Russia’s top exports, fell 1.2 percent to $83.8 a barrel on Tuesday but still well above levels seen in late March of under $80 a barrel. barrel.
Russian stock indexes are higher. The dollar-denominated RTS index gained 0.4 percent to trade at 1,014.4 points. Russia’s ruble-based MOEX Index traded 0.5 percent higher at 2,627.8 points, updating a more than one year high.
“The impression is growing that investors are using any excuse to activate the buying, completely ignoring the fact that the market is overbought,” said Alexei Antonov of Alor Broker.
He said rumors of a second wave of mobilization had failed to dampen the market and that upbeat economic growth forecasts this year were supporting Russian stocks.
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Translator: Apep Suhendar
Editor: Biqwanto Situmorang
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