The Russian rouble firmed past 63 per dollar in Moscow on Friday for the first time since early February 2020 and touched a fresh five-year high versus the euro, supported by continuing restrictions on currency trading.
The rouble has become the world’s best-performing currency this year thanks to artificial support from capital controls that Russia imposed to shield its financial sector in late February after sending tens of thousands of troops into Ukraine.
At 0723 GMT, the rouble was steady against the dollar at 63.32, earlier touching 62.6250, its strongest mark since Feb. 5, 2020, but banks are offering to buy roubles at much weaker levels.
Promsvyazbank analysts said that they expected the rouble to jump higher early on Friday, but that it would likely return towards 65 to the dollar towards the end of the session as market players close positions going into the weekend.
The rouble had lost 0.8 per cent to trade at 65.80 versus the euro, moving away from 64.9425, which it touched in early trade. That was its strongest since mid-2017.
The rouble is driven by export-focused companies that have to convert their foreign currency revenues, while demand for foreign exchange is limited as imports into Russia have waned amid disruption in logistics and sweeping Western sanctions.
President Vladimir Putin on Thursday cited the rouble rally as an example of Russia’s sound performance under sanctions.
Russian stock indexes fell.
The dollar-denominated RTS index (.IRTS) was down 0.3 per cent at 1,136.8 points, earlier touching its strongest point since Feb. 22. The rouble-based MOEX Russian index (.IMOEX) was 0.4 per cent higher at 2,287.9 points.