Rouble Resilience: Navigating Currency Challenges

The Russian rouble showed stability after the central bank ceased foreign currency purchases. Despite recent declines attributed to geopolitical tensions and new sanctions, President Putin urged calm. Analysts anticipate normalization in the financial markets. The rouble remains impacted by global dollar strength and seasonal shifts.

The Russian rouble held steady on Friday, following the central bank's decision to halt foreign currency purchases and President Vladimir Putin's assurance against panicking over recent currency declines. By late morning, the rouble was slightly weaker at 107.8 per U.S. dollar, having reached its lowest point this year.

Putin emphasized that sharp fluctuations were linked to budget-driven factors and seasonal variations, urging calm. The central bank's move to avoid foreign currency buys has visibly reduced market nervousness, according to PSB analyst Evgeny Loktykhov, who anticipates a gradual stabilization and decreased volatility.

While the currency's dip is partly attributed to the global dollar's resurgence post-U.S. elections, geopolitical tensions and fresh U.S. sanctions on Gazprombank significantly weighed on the market. The rouble improved against China's yuan, amid halted Western currency trading on MOEX.

(With inputs from agencies.)