The Russian ruble banknote is placed on top of US dollar banknotes in this illustration dated February 24, 2022. REUTERS/Dado Ruvic/Illustration/File Photo
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March 17 (Reuters) – The Russian ruble rose in Moscow trade and was slightly weaker offshore on Thursday as investors eyed Russia-Ukraine peace talks and reports of foreign currency coupon payments on Russia’s sovereign debt.
As the invasion entered its fourth week, the Ukrainian capital of Kyiv came under renewed Russian fire. Western sources and Ukrainian officials said Russia’s attack has stalled. Officials from both sides have since met again for peace talks, but they said their positions remained widely apart. Continue reading
In the financial markets, two market sources said some creditors had received payments in dollars for coupons on Russian bonds maturing this week. This means Russia may have averted its first default on external debt in a century. Continue reading
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“Even if this week’s payment comes, investors need to monitor next upcoming payments as they may be treated differently,” JPMorgan said in a note to clients.
Dollar coupon payments on bonds with fallbacks allowing payment in rubles are due next week and beyond. A $2 billion bond matures on April 4th.
The ruble rose 4.7% to 103.15 per dollar and 3.5% to 113.715 per euro in Moscow. It’s still down more than 20% against both currencies over the past four weeks.
On FX exchanges, ruble bids were quoted at 96 per dollar and traded at 104, down 3.9%.
International outrage over Russia’s invasion of Ukraine grew on Thursday as fighting continued. In response, Western nations have imposed unprecedented sanctions on Russia, triggering Russia’s worst economic crisis since the fall of the Soviet Union in 1991. read more
Russia also imposed tough new rules on foreigners seeking permits to buy and sell Russian assets ranging from securities to real estate, a Citigroup client memo showed, raising new concerns that Western investors could face hefty writedowns. Continue reading
The US House of Representatives on Thursday backed legislation that would strip Russia and Belarus of “most favored nation” trade status in view of the invasion of Ukraine, allowing for higher tariffs on imports from the two countries.
Russia’s annual inflation accelerated to 12.54% by March 11, the highest since late 2015, while shortages and a sharp rise in sugar prices prompted competition regulators to launch investigations into major sugar producers.
The Moscow stock market remained largely closed by order of the central bank and will remain so for the rest of the week. The shares last traded in Moscow on February 25, after which the central bank imposed restrictions.
The central bank is now in focus as it will hold a rate-setting meeting on Friday. The bank is expected to keep interest rates on hold at 20% and may shed more light on its future plans to regulate financial markets. Continue reading
While foreign exchange transactions are limited, including with bank accounts and overseas purchases, Russians can still buy and sell foreign exchange online, although spreads are high, indicating a lack of liquidity.
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Reuters reporting; Editing by Jonathan Oatis
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