Russian Rouble Slumps to over Three-week Low Against Dollar

The relatively low foreign currency sales by exporters at the beginning of the month hampered the Russian rouble’s sharp decline to a three-week low above 92 against the dollar on Tuesday. The Russian rouble weakened to a low above 92 against the dollar on Tuesday.

By 1259 GMT the rouble had lost 1.3% against the dollar at 92.16, its most fragile since Nov. 13.

It touched three-week lows against both the euro and the yuan, falling 1.3% to 99.74 and 1.1% to 12.88, respectively.

According to SberCIB analysts in a note, “It seems that demand for foreign currency is seasonally growing before the New Year and exporters are for the time being not selling FX too actively after the tax period ended a week ago.”

The month-end tax period, during which Russian exporters typically convert foreign currency into rubles, has now weakened the rouble.

Before last week, the cash had appreciated seven weeks of gains. Since President Vladimir Putin implemented the forced conversion of some foreign currency revenue for exporters in October, it has rebounded from more than 100 to the dollar. This is due to a reduction in capital outflows.

The currency is also supported by high interest rates. The Bank of Russia is expected to raise interest rates to 16% on Dec. 15, according to Reuters polls of analysts.

However, the majority of economists surveyed anticipate a weaker ruble in 2024.

Brent unrefined petroleum, a worldwide benchmark for Russia’s principal send out, was down 0.1% at $77.94 a barrel.

The stock indexes in Russia were mixed.

The dollar-designated RTS record was down 0.9% at 1,067.0 places. With 3,120.1 points, the MOEX Russian index based on the rouble gained 0.2 percent.