Russian rouble climbs to near two-week high vs dollar

The rouble strengthened to a near two-week high against the dollar on Wednesday as a favourable month-end tax period drew to a close, with capital controls and high interest rates continuing to buttress the Russian currency. By 1220 GMT, the rouble was 0.5% stronger against the dollar at 91.62, earlier reaching 91.5, its strongest point since Feb. 15.

The rouble strengthened to a near two-week high against the dollar on Wednesday as a favourable month-end tax period drew to a close, with capital controls and high interest rates continuing to buttress the Russian currency.

By 1220 GMT, the rouble was 0.5% stronger against the dollar at 91.62, earlier reaching 91.5, its strongest point since Feb. 15. It had gained 0.8% to trade at 99.22 versus the euro and firmed 0.5% against the yuan to 12.67. The rouble has recovered ground since being hampered by sanctions risk last week. It has been helped in part by the tax period, which usually sees exporters convert foreign currency revenues to pay local liabilities, and also has other fundamental factors playing in its favour.

"Tight monetary policy is creating important support for the rouble, together with the decree on the sale of exporters' revenues and the budget rule," said Dmitry Polevoy of Astra Asset Management, suggesting the rouble would be unlikely to fall sharply, including after March's presidential election. President Vladimir Putin is widely expected to easily win another six-year term in power.

The central bank, which held rates at 16% this month, expects to be able to begin easing borrowing costs

in the second half of the year. Brent crude oil, a global benchmark for Russia's main export, was down 0.9% at $82.86 a barrel.

Russian stock indexes were higher. The dollar-denominated RTS index was up 1.2% at 1,110.5 points. The rouble-based MOEX Russian index was 0.6% higher at 3,229.2 points.

Shares in dominant lender Sberbank were down 0.3%, underperforming the market, after the bank reported

record annual profits of 1.5 trillion roubles ($16.36 billion). For Russian equities guide see

For Russian treasury bonds see

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