The ruble crosses 70 against the dollar for the first time since May. According to Reuters

© Reuters. FILE PHOTO: Woman holding Russian Ruble banknote in this illustration taken May 30, 2022. REUTERS/Dado Ruvic/Illustration

By Alexander Marrow

MOSCOW (Reuters) – The ruble fell to its weakest since early May through 70 against the dollar on Wednesday, extending a weekly decline as fears of sanctions on Russia’s oil and gas kept the market at bay. school panic.

By 0713 GMT, the ruble was down 2.1% against the dollar at 70.31, having touched 70.6775 earlier.

It lost 1.7% to trade at 74.76 against the euro, having previously crossed the 75 threshold for the first time since late April. It fell 1.7% against the yuan to 10.06, its lowest level in nearly seven months.

The ruble has lost more than 7% this week against the greenback and about 11.5% since Russia’s oil prices took effect, but remains the world’s best performing currency this year, supported by capital controls and the initial drop in imports as a result of Western sanctions over Russia’s actions in Ukraine.

Rachel Ziemba, founder of Ziemba Insights, said the ruble has caught up with the weakness in Russia’s balance of payments. “In recent months, Russia’s export revenue has declined as the country sharply reduces its gas exports and the EU oil embargo is limiting oil revenues.”

“Meanwhile, imports have revived,” added Ziemba, meaning that instead of a balance of payments surplus due to huge imports due to shrinking imports, it is moving closer to a deficit.

Russia’s oil exports fell 11% from December 1-20 from the previous month, after the European Union’s embargo on Russian oil took effect, the Kommersant daily reported on Wednesday, cited unidentified sources familiar with the situation.

global standard for Russia’s main export, rose 0.1% to $80.1 a barrel.

Russia’s finance ministry is expected to tap the local debt market again on Wednesday, issuing three OFZ bonds as Moscow borrows money to finance its military campaign in Ukraine.

Russian stocks were mixed. BCS World of Investments said a further decline in the ruble could also cause the RTS index to fall.

The dollar-denominated RTS index fell 1.3% to 654.6, hitting its lowest level in more than two months. The ruble-based Russia’s MOEX index was 0.5% higher at 2,130.6, recovering from a near eight-week low hit in the previous session.

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