Russian rouble hovers near 62 vs dollar as tax period begins

Russian rouble hovers near 62 vs dollar as tax period begins
© Reuters. FILE PHOTO: A person holds the newly designed Russian 100-rouble banknote during a presentation in Moscow, Russia June 30, 2022. REUTERS/Evgenia Novozhenina

MOSCOW (Reuters) – The rouble steadied near 62 against the dollar on Monday, supported by rising oil prices and the start of a favourable month-end tax period, as the spectre of geopolitical risk continued to lurk over Russian markets.

At 0730 GMT, the rouble was 0.1% weaker against the dollar at 62.15, close to a one-week high. It had lost 0.2% to trade at 60.81 versus the euro and firmed 0.3% against the yuan to 8.58.

“The tax period, which has formally started, will gradually gain momentum, and with it volumes of foreign currency sales by exporters for tax purposes,” said Dmitry Polevoy, head of investment at Locko Invest.

Export-focused firms usually convert foreign exchange revenues into roubles to pay domestic liabilities, which supports the Russian currency.

The rouble is the world’s best-performing currency this year, supported by capital controls and slumping imports after Western governments imposed hefty sanctions on Russia over its actions in Ukraine, while scores of foreign companies paused operations in the country.

Brent crude oil, a global benchmark for Russia’s main export, was up 0.8% at $92.4 a barrel.

“The IMOEX index remains in a tight range lacking any positive drivers,” said BCS Global Markets. “On the other hand, RTS should power higher on further rouble appreciation – typical for the end-of-the-month tax period.”

Russian stock indexes were higher.

The dollar-denominated RTS index was up 0.7% to 997.7 points, earlier hitting 1,000 points for the first time since Oct. 7. The rouble-based MOEX Russian index was 0.9% higher at 1,967.4 points.

Source: Reuters