(Reuters) – The Russian rouble steadied near 96 to the dollar on Thursday, paring early losses on the support of increased foreign currency sales by the central bank and expectations that interest rates may be raised again at Friday’s meeting.
The central bank hiked by 350 basis points to 12% last month, responding to the rouble’s tumble past 100 to the dollar, and most analysts polled by Reuters expect another increase on Friday, although the CEOs of Russia’s two largest banks were leaning in favour of a hold.
At 0732 GMT, the rouble was 0.1% stronger against the dollar at 96.16 and had gained 0.1% to trade at 103.29 versus the euro. It had firmed 0.2% against the yuan to 13.20.
The rouble was supported by the central bank increasing foreign currency sales ninefold for a week from Sept. 14 to the equivalent of 21.4 billion roubles ($222.7 million) a day.
It has linked the move to the planned redemption of $3 billion worth of Russian Eurobonds on Sept. 16, saying holders would be paid in roubles and that some of them were expected to seek to convert into foreign currency.
President Vladimir Putin told an economic forum in Russia’s far east on Tuesday that exporters’ “restrained” return of foreign currency was putting the rouble under pressure, but promised no sudden moves, such as a return to capital controls, to limit rouble volatility for now.
Sberbank CEO German Gref said this week that the rouble was “unjustifiably undervalued” and that authorities were not doing enough to stabilise the currency.
Brent crude oil, a global benchmark for Russia’s main export, was up 0.7% at $92.52 a barrel.
Russian stock indexes were lower.
The dollar-denominated RTS index was down 0.7% to 1,023.8 points. The rouble-based MOEX Russian index was 0.8% lower at 3,124.2 points.
On Tuesday, the economy ministry updated its macroeconomic forecasts, envisaging higher inflation and a weaker rouble over the coming years, as the costs of Russia fighting the war in Ukraine mount.
($1 = 96.1025 roubles)
(Reporting by Alexander Marrow; Editing by Sharon Singleton)
