Ruble drops to more than 15-month low vs. dollar on political risk concerns

The Russian ruble slumped to a greater than 15-month low in opposition to the greenback and euro on Friday, weighed down by home political threat considerations after an aborted armed mutiny over the weekend and missing any assist drivers.

By 10:00 GMT, the ruble was 0.8% weaker in opposition to the greenback at 88.25 after earlier hitting 88.6775, its weakest level since March 29, 2022.

It misplaced 0.7% to commerce at 95.78 versus the euro after additionally hitting a 15-month low of 96.3225. It shed 0.6% in opposition to the yuan to 12.13, earlier clipping a greater than 14-month low.

“The ruble continues to crumble,” Alor Broker mentioned in a observe. “It misplaced one other 1.4% in worth yesterday, regardless of stabilizing oil.

“The target for the dollar-ruble pair of 90 is approaching and is likely to be reached.”

Capital controls have helped insulate the ruble in opposition to geopolitics within the 16 months since Russia invaded Ukraine, however mercenary chief Yevgeny Prigozhin’s aborted weekend march towards Moscow reverberated by markets and left questions over President Vladimir Putin’s grip on energy.

The ruble misplaced a key assist issue on Wednesday as a month-end tax interval that usually sees exporters convert overseas foreign money revenues to fulfill native liabilities handed.

The Bank of Russia’s Deputy Governor Alexei Zabotkin mentioned lowered export revenues and the stability of funds have been figuring out the ruble’s weakening, which he mentioned carried no dangers to monetary stability.

“But, certainly, the exchange rate dynamics will be taken into account at the next board meeting on the key rate in terms of clarifying the impact … on inflation dynamics this year,” the Interfax news company quoted Zabotkin as saying on Friday.

Brent crude oil, a worldwide benchmark for Russia’s major export, was up 0.6% at $74.75 a barrel. Russian inventory indexes have been decrease.

The dollar-denominated RTS index was down 1.3% to 994.0 factors. The ruble-based MOEX Russian index was 0.4% decrease at 2,784.6 factors.

Shares in Gazprom dropped about 0.7% after the power group’s shareholders accepted the board’s advice in opposition to paying full-year 2022 dividends after allocating a half-year dividend of 1.2 trillion rubles (US$13.6 billion).

(Reporting by Alexander Marrow; Editing by Jamie Freed, Robert Birsel and Jane Merriman)