Russian rouble weakens on weaker oil

Russian rouble weakens on weaker oil
Russian rouble weakens on weaker oil
© Reuters. FILE PHOTO: The newly designed Russian 100-rouble banknotes are seen at the Goznak printing factory in Moscow, Russia July 6, 2022. Moscow News Agency/Handout via REUTERS

(Reuters) – The Russian rouble weakened against the U.S. dollar on Thursday on weaker oil, with analysts expecting it to reverse the trend next week as a new domestic tax period starts.

At 0713 GMT, the rouble fell 0.3% against the dollar to 61.47 and lost 0.2% to trade at 61.50 versus the euro. Against the , the Russian currency was down 0.14% at 7.25.

The Russian rouble has been the world’s best performing currency this year, as strict capital controls have pushed it higher despite Moscow being hit with unprecedented Western sanctions for its invasion of Ukraine.

The rouble continues to get support from the capital controls, which the central bank does not plan to further soften for now, according to the governor Elvira Nabiullina.

, a global benchmark for Russia’s main export, was 0.16% down at $92.50 a barrel, having traded above $97 at the start of this week.

Analysts expect the rouble to remain under pressure during the session amid weaker oil prices.

“Worsening situation on the energy markets and reduced foreign exchange offer from the exporting companies will contribute to the rouble’s weakening,” chief analyst Bogdan Zvarich said in a research note, adding that the currency would likely move in a 61.5-62.0 range versus the dollar.

Russian stock indexes were mixed, with the dollar-denominated RTS index losing 0.1% to 1,112.3. The rouble-based MOEX Russian index was 0.2% up at 2,173.2.

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