Economy ministry says Russia’s currency purchase plans hurt ruble

MOSCOW, Jan 31 (PRIME) – The Russian government’s plans to purchase foreign currency have exerted pressure on the ruble, the Economic Development Ministry said late on Monday in its weekly monitoring report.

On January 25, the Finance Ministry said it plans to start buying or selling foreign currency at the local market from February through the central bank depending on the oil price. The central bank said on January 26 that it expects no pressure on the ruble from sales.

“The exchange rate of the ruble was under some pressure from the announced plans of the Bank of Russia to start buying hard currency from February at an approximate amount of U.S. $100 million a day,” the Economic Development Ministry said.

But due to the decision, the past week has become the best week for the Russian stock market since the beginning of 2017.

“The intention of the Bank of Russia…determined purchases on the whole market, and shares of exporters won the most, while the major indices gained about 5% in the week. An additional driver for the market was expectations of a possible easing of the U.S. sanctions regime,” the ministry said.

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