Rouble strengthens as Russia sells $80m in foreign reserves
Russian currency is being hurt by falling oil prices and Western sanctions over Ukraine
The rouble has strengthened sharply, reversing steep losses on Monday, with traders saying modest foreign-currency sales in a thin market were driving the Russian currency higher.
Earlier, the rouble was around 3.3 per cent stronger against the dollar at 56.39 roubles per dollar and 2.5 per cent stronger against the euro at 69.29 .
The central bank said that the finance ministry sold $80 million in forex market interventions on December 26th, part of co-ordinated government efforts to defend the rouble.
The central bank releases its interventions data with a time lag and said it did not intervene itself on December 26th. The Russian currency is down some 40 per cent against the dollar this year, hurt by falling oil prices and Western sanctions over Ukraine that have limited Russian firms’ ability to borrow abroad and spurred demand for dollars.
A forex trader at a Russian bank said the central bank was unlikely to be intervening on Tuesday, citing the small volumes of forex sales that were moving the market.
“Our market is very thin ahead of the New Year’s holidays. With just $700 million in tomorrow trades, the rouble had moved by over 5 per cent,” the trader said.
Source: Irish Times – Rouble strengthens as Russia sells $80m in foreign reserves
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