Cbank says to buy less foreign currency than before suspension

MOSCOW, Dec 21 (PRIME) -- The central bank will purchase less foreign currency for the Finance Ministry on the domestic market than before the suspension of transactions due to lower oil prices, the authority said in a statement on Friday.

“Stabilization of the situation on the Russian financial market allows the central bank to resume foreign currency market interventions in January 2019 in the framework of the budget rule,” the central bank said.

“The formation of oil prices at a level below the one they reached before a central bank decision to suspend the purchases also means reduction of the monthly amount of operations.”

In February 2017, the ministry entered the currency market to minimize dependency of the ruble on oil prices. The ministry wanted to use additional oil and gas revenue of the budget and assured the influence on the ruble quotations would be minimal. The transactions were made by the central bank.

In August 2018, the central bank said it stopped buying foreign currency for the ministry until the end of September following a significant weakening of the ruble in the light of fresh U.S. sanctions against Russia and high volatility on emerging markets. In September, the regulator decided to prolong the suspension of the purchases until the end of 2018.

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