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Russian rouble steady as exporters convert foreign currency

Published 10/18/2022, 03:56 AM
Updated 10/18/2022, 04:02 AM
© Reuters. FILE PHOTO: The newly designed Russian 100-rouble banknotes are seen at the Goznak printing factory in Moscow, Russia July 6, 2022. Moscow News Agency/Handout via REUTERS

MOSCOW - Russian markets opened steady on Tuesday as month-end tax payments offered support to a rouble buffeted by ever-present investor jitters over the possibility of fresh Western sanctions against Moscow.

The Russian rouble opened 0.4% down against the U.S. dollar, trading at 61.91 at 0730 GMT.

Against the euro, the rouble climbed 0.4% to 60.54 while it was unchanged against the Chinese yuan - an increasing important currency for Moscow as it looks to deepen economic ties with Beijing - at 8.53.

After surging to multi-year highs under strict currency controls this year, the rouble has softened since the start of October in volatile trading attributed to Moscow's military setbacks in Ukraine and the possibility of new sanctions.

"The tax payment period begins today, and therefore demand for roubles is growing ... but risks remain high and many market players are still taking a wait-and-see approach," Sinara Investment Bank analysts said in a research note on Tuesday.

The month-end tax period prompts Russian exporters to convert their foreign currency earnings into roubles to make payments to the Russian treasury, typically boosting the domestic currency.

"The fall of the rouble below 60 against the U.S. (dollar) is not guaranteed, but a return to below 61 is quite possible," said Otkritie Bank research analyst Andrey Kochetkov.

Any upside, however, is likely to be limited by continuing discussions in Brussels over another package of sanctions on Russia, analysts added.

After adding about 3% on Monday, Russian stock markets consolidated gains on Tuesday morning.

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The dollar-denominated RTS index was down 0.1% at 1,026.5 points while the rouble-based MOEX Russian index was 0.4% up at 2,020.6 points.

For Russian equities guide see

For Russian treasury bonds see

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