BLBG:Ruble Weakens on Crude Oil as Investors Await CPI, Rates Meeting
The ruble weakened against the dollar as oil retreated and investors awaited inflation data that may influence a central bank interest-rate meeting.
The ruble declined 0.4 percent to 29.9745 against the dollar by 12.58 p.m. in Moscow. The currency was little changed at 34.8215 against a basket of dollars and euros, which the central bank uses to curb exchange rate moves that can crimp companies’ competitiveness.
Oil, Russia’s main export, declined 0.5 percent to $97.27 per barrel in New York trading. The annual inflation rate for January may accelerate to 6.9 percent from 6.6 percent, according to a Bloomberg survey. Consumer-price data is due to be published tomorrow or the next day and the central bank meets Feb. 12 to discuss interest rates. Bank Rossii has kept rates unchanged for four months after an unexpected increase in September.
“Further strong ruble appreciation is possible only if we see a strong movement in the oil price,” Michail Azizbaev, a currency dealer at OAO Metallinvestbank, said by phone from Moscow.
Weak economic growth at the end of 2012 and a year-on-year drop in investment may push the central bank to take a “more dovish stance,” VTB Capital analysts Maxim Oreshkin and Daria Isakova in Moscow wrote in a note today.
High borrowing costs are “concerning,” President Vladimir Putin said Jan. 31 at a government meeting.
The central bank is likely to keep rates on hold at the February’s meeting until price growth peaks, making an interest rate cut likely in March-April, the VTB analysts wrote.
The yield on notes maturing in February 2027 declined two basis points to 7.02 percent. The Micex index of corporate bonds was unchanged at 93.51.
To contact the reporter on this story: Vladimir Kuznetsov in Moscow at vkuznetsov2@bloomberg.net
To contact the editor responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.net
