The ruble hit a four-year high against the US dollar

The Russian currency is strengthening on the eve of financial deadlines.

The Russian ruble hit a four-year high against the US dollar and a seven-year high against the euro on Friday. The ruble is being paid through capital controls, a new gas payment system based on rubles and an impending corporate tax, which increases domestic demand for the currency. The hit of 57.67 rubles against the dollar at 08:13 GMT marks the ruble’s strongest position since March 2018, according to data from the Moscow Stock Exchange. The ruble also appreciated by about 5% against the euro, with the exchange rate reaching less than 60 rubles per euro.

According to Bloomberg, the Russian currency has become the best performing currency in the world this year despite its sharp decline in April due to the unprecedented economic sanctions imposed on Russia.

However, it has since strengthened thanks to the actions of the Russian Central Bank and the government. Under the regulator’s capital controls, Russian citizens and residents are allowed to buy euros, US dollars or other European currencies at the official exchange rate, but they cannot withdraw foreign money until September 9. Persons who had US dollar and euro accounts in Russian banks before March 9 are allowed to withdraw $10,000 or its equivalent for the period until September 9. However, Russian citizens can buy any other foreign currency and ruble withdrawals are not limited.

The expected payment of taxes will also raise the value of the ruble upwards, since it traditionally requires additional conversion of foreign currency into rubles.

Russian stock indices also rose. The Moscow dollar-denominated index rose 0.33% to 2444.57 points, while the ruble-denominated RTS rose 0.72% to 1254.69 points around 07:04 GMT, according to trading room data.

source : Russia Today

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