The Russian rouble jumped to a seven-year high against the dollar and euro on Moscow Exchange on Tuesday, supported by capital controls and the prospect of favourable month-end tax payments.
By 1423 GMT, the rouble was 2.1% stronger against the dollar at 54.44 . It earlier touched 54.20 per dollar, its strongest mark since June 2015.
Against the euro, the currency gained 1.8% to trade at 57.80 , earlier touching 57.0250, its strongest point since May 2015.
The rouble, which has become the world’s best-performing currency this year, is steered by Russia’s high proceeds from commodity exports, a sharp drop in imports and a ban on households withdrawing foreign currency savings.
Top policymakers used Russia’s annual economic forum in St. Petersburg last week to highlight the rouble’s recent strength. There are concerns this could weigh on the economy as it tips into recession amid harsh sanctions over what Moscow calls a “special military operation” in Ukraine.
“At the start of the trading day, the Russian market may continue its upward movement due to the lack of significant external and internal drivers for selling,” Veles Capital said in a note.
BCS Express said it was likely that the rouble remains heavily influenced by the market imbalance between demand and supply.
“There are still not enough buyers of foreign currencies to satisfy sales, without pushing foreign currency rates lower,” BCS said.
The rouble is buttressed by companies that need to pay taxes early next week. For export-focused firms, that means converting dollar and euro revenue into roubles.
SberCIB Investment Research said these should pick up in the coming days, adding that it was hard to attribute the rouble’s recent gains to exporters’ increasing offers of hard currency because moves have been on low trading volumes.
Russian stock indexes were mixed.
The dollar-denominated RTS index (.IRTS) was up 1% at 1,370.9 points, its highest since Feb. 21, shortly before Russia sent tens of thousands of troops into Ukraine.
The rouble-based MOEX Russian index (.IMOEX) was 1.4% lower at 2,374.2 points.