MOSCOW (Reuters) – The Russian ruble weakened further on Thursday, remaining at its lowest against the U.S. dollar since October 2023.
At 0740 GMT, the ruble fell 0.4% to 97.40 against the dollar, LSEG data showed. The ruble reached the 97 mark on Wednesday for the first time since October last year.
The ruble fell 1.29% against the yuan to a one-year low of 13.65, according to LSEG data. In trading on the Moscow Stock Exchange (MOEX), the ruble fell 0.18% to 13.71 against the yuan.
“The ruble has again reached an annual low; an autumn fall in the national currency amounts to almost 15%,” said analysts at broker BCS.
Analysts pointed to several factors behind the ruble’s current weakness, including the Oct. 12 expiration of a license from the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) that allowed commercial banks to do business with MOEX.
The license was issued to allow banks to scale down their activities with MOEX after Western sanctions on the exchange and its clearing agent, the National Clearing Centre, were imposed on June 12.
The sanctions halted all dollar and euro trading at MOEX, making the Chinese yuan the most traded foreign currency in Russia. Trading in dollars and euros has shifted to the over-the-counter (OTC) market, making price data unclear.
There are concerns in the market that Chinese banks that provide yuan liquidity for exchange trading could withdraw due to compliance concerns after the OFAC license expires.
Other factors putting pressure on the ruble include weaker oil prices in the August-September period, withholding of foreign exchange due to international transaction issues and the growth of cross-border payments in rubles, analysts and traders said.
Increased foreign exchange sales by the state in October supported the Russian currency, but this was not enough to offset downward pressure, analysts said.
One-day ruble-dollar futures, which trade on the Moscow exchange and provide a guide to OTC market rates, were flat at 96.54. The central bank’s official exchange rate, which it calculates based on OTC data, was set at 96.95 per dollar.
The ruble fell 0.42% to 106.55 against the euro, LSEG data showed.
a global benchmark for Russia’s top export, rose 0.67% to $77.07 per barrel.
