Russian Rouble Stabilizes Ahead of Key Central Bank Decision

The Russian rouble remains flat against the dollar, just before the central bank’s anticipated interest rate hike aimed at curbing inflation. Foreign currency sales by exporters and upcoming corporate tax payments are currently bolstering the rouble. Meanwhile, trading data remains obscure due to recent Western sanctions.

The Russian rouble maintained its position against the dollar on Friday as the market awaited the central bank's rate decision. This stabilization follows three consecutive days of the rouble strengthening, largely due to increased foreign currency sales by exporting businesses. By 0730 GMT, the rouble was 0.4% lower at 85.35 against the dollar.

According to a Reuters poll, the Russian central bank is projected to increase its key interest rate by 200 basis points at an upcoming board meeting. The move comes as the institution grapples with inflation, which has been exacerbated by state expenditure and lending growth. Recent Western sanctions against the Moscow Exchange and the National Clearing Centre have shifted major currency trading to the over-the-counter market, complicating the observation of pricing data.

In anticipation of corporate tax payments scheduled for July 29, Russian exporters have escalated their foreign currency sales, thereby lending support to the national currency. The rouble also appreciated by 0.6% to 11.69 against the yuan, a currency which has dominated Moscow trading sessions since the latest sanctions. It was, however, 0.3% down at 92.50 against the euro. Brent crude oil prices, a critical export for Russia, dipped by 0.1% to $82.34 per barrel due to decreased demand from China, the world's largest crude importer.

(With inputs from agencies.)