(Reuters) – The Russian rouble eased marginally on Wednesday, hovering near 104 to the dollar in Moscow as the central bank prepared to reopen trading of shares in Russia’s main companies on Thursday after a nearly four-week-long hiatus.
The Bank of Russia announced some stock market trading would resume on March 24, with 33 securities included into the benchmark IMOEX index set to be traded on Moscow Exchange for a limited period of time and with short selling banned.
Russia, which took a hit from unprecedented Western sanctions for starting what it calls “a special operation” in Ukraine, appeared to have averted default on foreign debt by making a coupon payment on a sovereign Eurobond in U.S. dollars.
Russia had been due to make a $66 million payment to bondholders on Monday on the Eurobond maturing in 2029. A bondholder said the payment had been received.
But Russian holders of domestic corporate Eurobonds face delays in receiving payments settled through international agents, as transactions get snarled up by sanctions, Russia’s National Settlement Depository (NSD), companies and analysts said.
By 1203 GMT, the rouble was 0.2% weaker against the dollar at 103.79 and had gained 0.5% to trade at 113.88 versus the euro.
The rouble has stabilised after falling to a record low of 120 in Moscow this month and even further on the interbank market to 150 as Russia took a hit from unprecedented Western sanctions following its invasion of Ukraine, what it terms “a special operation”, that started on Feb. 24.
Before that, the rouble traded at about 80 to the dollar.
Promsvyazbank analysts said in a note that they expected further consolidation of the rouble in the range of 100-105.
Demand for rouble liquidity has declined as the central bank sold 0.8 trillion roubles ($7.7 billion) at a one-day “fine-tuning” repo auction on Wednesday, lower than in previous days.
“Demand at overnight repo auctions is falling fast,” Veles Capital brokerage said in a note, explaining that even though banks’ liquidity levels have fallen to their lowest since June last year, lenders are repaying previous repo debts to the central bank.
OFZ BONDS STEADY
Trading on the OFZ bond market continued for a third day after it was shut in late February.
The central bank said last week it would begin buying OFZ bonds to limit volatility, after it held its key interest rate at 20% in the wake of an emergency rate hike in late February.
The central bank has so far not disclosed the size of its interventions on the OFZ market that helped stabilise prices and provided extra liquidity to the financial system.
Yields on benchmark 10-year OFZ bonds, which move inversely to their prices, stood at 13.88% on Wednesday after hitting a record high of 19.74% on Monday.
($1 = 103.9070 roubles)
(Reporting by Reuters; Editing by Edmund Blair and Bernadette Baum)
