Rouble steadies ahead of bond auctions with inflation in focus
MOSCOW, Oct 13 (Reuters) – The Russian rouble stabilised on Wednesday ahead of government bond auctions and a weekly inflation report that could shed light on how much the central bank might raise rates when it meets next week.
At 0748 GMT, the rouble was 0.1% weaker against the dollar at 71.85 and had shed 0.2% to trade at 82.99 versus the euro.
Brent crude oil, a global benchmark for Russia’s main export, was down 0.1% at $83.35 a barrel ahead of a speech by President Vladimir Putin at an energy conference at a time of surging gas prices and supply shortages in Europe.
Higher gas prices mean Russia could receive an extra $21 billion in liquidity in 2022, which suggests the rouble is likely to average 68.3 against the dollar next year, 2.5% stronger than previously thought, Sberbank CIB said in a note.
Weekly inflation data is in focus after the economy ministry raised its year-end forecast to 7.4% from 5.8%, highlighting the stubbornly rising prices that have hit living standards already dented by the COVID-19 pandemic.
An inflation rate above the central bank’s (CBR) 4% target suggests it will raise its key interest rate for the sixth time this year at its next board meeting on Oct. 22.
Earlier this week, Putin ordered his government to study new social support measures to soften the hit from higher prices, though higher social spending could further spur inflation.
“We expect CBR to revise its inflation and policy outlook during its October meeting and raise the key rate another 50 basis points to 7.25%,” Sova Capital said.
The finance ministry’s OFZ bond auctions are also on the market radar as demand for the high-yielding fixed-income securities could support the rouble.
Russian stock indexes were down after hitting record highs.
The dollar-denominated RTS index fell 0.5% to 1,861.5 points. The rouble-based MOEX Russian index was 0.4% lower at 4,247.2 points, though still near its all-time peak of 4,284.53 hit on Monday.
For Russian equities guide see
For Russian treasury bonds see
Source: Read Full Article