The Russian rouble climbed on Wednesday, firming past 60 per dollar, despite Russia’s decision to ease some capital controls and expectations of an interest rate cut at an upcoming central bank meeting.
The rouble has become the world’s best-performing currency so far this year, boosted artificially by capital controls and supported by high prices for commodities, Russia’s key exports.
At 1211 GMT, the rouble was 2.2% stronger against the dollar at 59.66 on the Moscow Exchange, leaving the relatively narrow range of 60.0-62.5 it was in over the past few days after rapid swings in May.
It firmed more than 3% to 63.47 against the euro.
The rouble showed little reaction to Russia’s decision to relax some capital controls, which have been steering the currency since February after Moscow sent tens of thousands of troops into Ukraine on Feb. 24.
Read more: Rupee makes sharp recovery against US dollar
Weeks after the rouble rallied to a near five-year high against the euro, Russia allowed export-focused companies to transfer forex to their overseas accounts under certain conditions, a move seen to be aimed at helping to pay for imports and preventing the rouble from strengthening.
At the same time, the central bank raised the ceiling for cross-border transactions for individuals, saying Russian residents and non-residents from “friendly” states would be able to channel abroad the equivalent of up to $150,000 a month, up from the previous limit of $50,000.
“The rouble rate is still determined mostly by the trade balance, where the situation is not really changing: exports remain relatively high, while imports have collapsed,” said Evgeny Suvorov, an economist at CentroCreditBank.
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