Thursday, December 18, 2014

Russian PM demands to restore order at currency market

Russian Prime Minister Dmitry Medvedev on Wednesday warned citizens and companies of attempting to make profit in the current unstable financial situation, calling the ongoing events at the currency market a "game of emotions."

"We must proceed from the fact that purchasing of currency in the present situation means buying it by unfavorable rate," Medvedev told a government meeting.

He noted that the government possessed enough foreign currency to finance economic projects and called to restore order on the currency market promptly.

"The exchange rate has spilled out of the limits which are comfortable for our economy," Interfax news agency quoted him as saying.

Medvedev reiterated earlier remarks made by various senior government officials that ruble has been underestimated and its rate does not match the actual state of affairs in the Russian economy.

The government would work with exclusively market tools and in close coordination with the Central Bank, he noted.

The meeting was also attended by top managers of Russia's ten largest companies, including gas monopoly Gazprom, oil giants Rosneft, Bashneft, Tatneft and Lukoil.

The prime minister ordered the state financial watchdog Rosfinmonitoring to start daily monitoring of how these companies spend their currency reserves.

This is the second government meeting in the last two days devoted to the situation at the Russian financial sector. On Tuesday, dubbed by the local media as "black", Medvedev convened an extraordinary meeting to discuss response measures in the current financial and economic situation in the country. - Xinhua


  1. The ruble made a modest rally against the dollar and the euro in early trading on Thursday morning....

    The dollar fell to 58.3 rubles, while the euro fell slightly further to 71.9 rubles. This comes two days after the ruble's historic plummet, when the Russian currency lost 20% of its value in one day, reaching lows of 80 and 100 to the dollar and euro respectively.

    The Russian stock market also made a slight recovery. The Russian Trading System, or RTS, index showed an increase of 5.89% to 760.56 in morning trading.

    Tuesday's catastrophic drop in the ruble's value followed an early morning announcement by the Russian Central Bank of a raise of the interest rate to 17 percent.

    The rate hike, which was Russia's highest since the government default of 1998, took place less than a week after the bank's previous increase to 10.5 percent.

  2. The ruble weakened against the dollar and euro today with traders saying President Vladimir Putin had so far offered no concrete measures to pull Russia out of a crisis at his end-of-year news conference....

    The ruble was around 3 percent weaker against the dollar at 62.04 after opening more than 1 percent higher. The rouble was also around 2 percent weaker versus the euro at 76.50 on the Moscow Exchange.

    Traders said they saw no major measures from Putin so far to address the crisis that has seen the ruble collapse around 45 percent against the dollar so far this year amid slumping oil prices and Western sanctions over Ukraine.

    They said market moves were exacerbated by thin liquidity and that small volumes were capable of moving the market by several percent, including trades not related to Putin's speech.


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