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Russian Rouble Steadies after Biden Comments Cause Sell-off

MOSCOW, March 18 (Reuters) - The rouble was flat against the dollar on Thursday, steadying after a sell-off in Russian assets triggered by U.S. President Joe Biden saying his Russian counterpart Vladimir Putin would pay for attempted election interference.

At 0748 GMT, the rouble was 0.1% weaker against the dollar at 73.74, after losing more than 1% in the previous session, at one point touching 74.22, its weakest since March 9.

Against the euro, the rouble had gained 0.2% to trade at 88.09.

Biden was quoted by ABC News as saying that Putin would face consequences for directing efforts to swing last year’s U.S. election in Donald Trump’s favour.

Biden made his comments after a U.S. intelligence report released on Tuesday supported longstanding allegations that Putin was behind Russian interference in U.S. elections, an accusation Russia called baseless.

Washington is expected to impose new sanctions on Moscow as soon as next week.

“One of the main fears remains possible restrictions on Russian government debt,” the broker Otkritie said in a note.

Russian Finance Minister Anton Siluanov said on Wednesday it would be a pity if foreigners stopped buying Russia’s debt, but Moscow would find ways to fund its costs. However, a slew of analysts said measures targeting Russia’s debt were unlikely.

“We believe that next week the United States will limit itself to targeted sanctions and the rouble will recoup some of its losses,” said Mikhail Vasiliev of Sovcombank.

The geopolitical premium paid for the rouble appears significant, however. In early 2020, when oil prices, the main driver of the rouble’s exchange rate, were last near current levels of around $67 a barrel, the rouble stood at about 61 to the dollar.

Russian stock indexes were also recovering some of Wednesday’s losses, when the dollar-denominated RTS index fell 3.8% and the rouble-based MOEX Russian index shed 2.5% .

On Thursday morning, the RTS index was up 0.8% at 1,505.4 points and the MOEX Russian index up 0.5% at 3,524.2.

Reporting by Alexander Marrow; additional reporting by Elena Fabrichnaya; Editing by Kevin Liffey

Source: Reuters

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