Ruble closes highest since February on gas sales


A view shows Russian ruble coins in this illustration taken October 26, 2018. REUTERS/Maxim Shemetov

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March 23 (Reuters) – The Russian ruble closed at its highest level this month against the dollar on Wednesday, both in Moscow and abroad, after President Vladimir Putin said Russia would start selling its gas to “unfriendly” countries in rubles.

The ruble ended below 100 to the dollar, still down more than 22% this year as Russia faces tough global sanctions triggered by its invasion of Ukraine at the end of the month. last.

Gas prices in Europe soared after Putin’s shock announcement amid fears the move could exacerbate the region’s energy crisis.

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“This appears to be an effort by Russian authorities to put pressure on Western countries by forcing foreign buyers of Russian gas to use rubles, with the added benefit of supporting the value of the currency,” said Liam Peach, Europe economist. emerging at Capital. The economy in a customer note.

The ruble gained 6% to close at 97.7375 to the dollar in Moscow after touching 94.9875, its strongest since March 2. It closed up 8.8% to 96.5 on the EBS platform. Both closing prices were the highest since February.

Against the euro, the ruble appreciated 6% to 108.01 in Moscow.

Trading in OFZ bonds resumed this week, and the Bank of Russia announced that some stock trading would resume on March 24 after a nearly month-long hiatus, with 33 stocks included in the benchmark IMOEX index (.IMOEX) should be traded on the Moscow Stock Exchange for a limited time and with a ban on short selling. Read more

So far, the central bank has not disclosed the extent of its interventions in the OFZ market that have helped stabilize prices and provide additional liquidity to the financial system.

Yields on benchmark OFZ 10-year bonds, which move inversely to their prices, closed at 13.85% on Wednesday after hitting a record high of 19.74% on Monday.

The benchmark returned 8.42% at the end of 2021.

PAYMENT BY COUPON

Russia appears to have avoided a default on its foreign debt by paying a dollar coupon on a foreign bond maturing in 2029. A bondholder said the payment had been received.

But Russian holders of domestic corporate Eurobonds are facing delays in receiving payments settled by international agents, as transactions are blocked by sanctions, Russia’s National Settlement Depository (NSD) has said. , companies and analysts. Read more

Demand for ruble cash declined as the central bank sold 800 billion rubles ($7.7 billion) in a one-day “fine-tuning” auction on Wednesday, down from days previous ones.

“Demand at overnight repo auctions is falling rapidly,” brokerage firm Veles Capital said in a note, explaining that even as banks’ liquidity levels fell to their lowest since June this year last, lenders repay previous repo debts to the central bank.

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Reuters reporting; Editing by Edmund Blair, Bernadette Baum, Alex Richardson and David Gregorio

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