Russian rouble weakens past 63 vs dollar after EU sanctions
2022.05.31 12:06
FILE PHOTO: A picture illustration shows U.S. Dollar and Russian Ruble banknotes in Sarajevo, March 9, 2015. REUTERS/Dado Ruvic/File Photo
(Reuters) – The Russian rouble firmed past 61 against the dollar on Tuesday but soon slipped back towards 64 as capital controls provided support and concerns about new European sanctions dragged the market lower.
European Union leaders agreed in principle on Monday to cut 90% of oil imports from Russia by the year-end and on other sanctions, such as cutting Sberbank from the SWIFT transaction network, to punish Moscow for its intervention in Ukraine.
At 0732 GMT, the rouble was 1.5% weaker against the dollar at 63.09. Last Wednesday it had hit 55.80 to the dollar, its strongest since February 2018, before falling to 66.70 by the end of the week.
Against the euro, the rouble eased 0.6% to 64.71, having last Wednesday hit a seven-year high of 57.10, at the peak of month-end tax payments that usually prompt export-focused companies to convert foreign currency to meet liabilities.
Boosted by capital controls, the rouble had risen to become the world’s best-performing currency so far this year until last week’s slide. New gas payment terms for EU consumers that require conversion of foreign currency into roubles and a fall in imports have also supported the rouble.
Russian stock indexes were down.
The dollar-denominated RTS index fell 2.2% to 1,188.3 points. The rouble-based MOEX Russian index was 0.8% lower at 2,381.0 points.
Shares in Sberbank, Russia’s No.1 lender, slightly underperformed the broader market and fell 1.1% on the day after the EU agreement on new sanctions. The bank said the move to cut it from the SWIFT messaging system would not affect its operations.
