Ruble Strengthens as Russia Readies for Olympics Amid Oil Gain

Cash, Calculator, Pen

(Bloomberg – bloomberg.com – Vladimir Kuznetsov – January 8, 2014) The ruble strengthened after the resumption of trading in Moscow as oil gained and investors bet next month’s Winter Olympics will support Russia’s currency.

The ruble appreciated 0.4 percent to 38.4873 against Bank Rossii’s target basket of dollars and euros by 2:03 p.m. in Moscow. The yield on Russian government bonds maturing in February 2027 rose two basis points, or 0.02 percentage point, to 7.96 percent.

Brent crude increased for a second day in London, adding 0.1 percent to $107.48 per barrel. Russia receives about half of its budget revenue fro oil and natural gas sales. The country’s first Winter Olympics are set to open on Feb. 7 in the Black Sea resort of Sochi.

“Oil is up for a second day, and we expect the ruble to get support in advance of the Sochi Olympics,” Vladimir Miklashevsky, a trading desk strategist at Danske Bank A/S in Helsinki, said by e-mail. “It’s going to be an inflow of guests, and a spike in demand for local services.”

The ruble gained 0.3 percent versus the dollar to 33.1100 and strengthened 0.6 percent against the euro to 45.0595. The Moscow Exchange was closed yesterday for Russian Orthodox Christmas. It had been closed from Jan. 1 to Jan. 3 for public holidays, the last day of which is today.

Article ©2014 Bloomberg L.P. All Rights Reserved.  Article also appeared at http://www.bloomberg.com/news/2014-01-08/ruble-strengthens-as-russia-readies-for-olympics-amid-oil-gain.html

Comment