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Russian ruble hits the highest level in more than 4 years

Today, the value of the Russian ruble reached its highest level since March 2018.

At 7:25 a.m. (local time), the Russian ruble gained 0.7% value against the USD, trading at 57.44 rubles per dollar on the Moscow Exchange, the highest level in more than 4 years. Against the euro, the ruble rose 0.9 percent to 59.57 rubles per euro, hovering near a seven-year high.

The ruble strengthens as exporters have to convert their foreign currency earnings into local currencies. The coin has gained about 30% of its value against the USD this year, despite the economic woes, making it the world’s best performing currency. In addition, capital controls imposed at the end of February to protect Russia’s financial sector also contributed to the currency’s appreciation.

The strength of the ruble has raised concerns about the negative impact on Russia’s budget revenues from exports. Yesterday, Russia cut the share of foreign currency receipts that exporters have to convert into rubles from 80% to 50%.

Dmitry Polevoy, Head of Investments at LockoInvest, said that despite the slight easing in capital controls, the ruble could still remain firmly at 55 rubles to the dollar in the near term. Sinara Investment Bank said the ruble rate could return to 60-65 rubles to the dollar by June.

At banks, the ruble was slightly weaker on May 24. Sberbank – Russia’s largest bank – lists rates at 58.2 rubles per dollar and 60.38 rubles per euro.

Session An (according to Reuters)

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