MOSCOW: The Russian rouble opened flat on Thursday, holding support from month-end tax payments ahead of key monetary policy meetings in Europe and Russia. The rouble has been helped in recent days by export-focused Russian companies converting parts of their dollar revenues into roubles in order to meet monthly tax payments which end next week. At 0725 GMT, the rouble was just 0.08 percent weaker against the dollar at 57.79 and had lost 0.16 percent to trade at 68.32 versus the euro. Brent crude oil , a global benchmark for Russia’s main export, was down 0.17 percent at $58.34 a barrel. Rouble volatility is expected to increase by the end of the week as the market eyes a European Central Bank (ECB) meeting due later on Thursday and a Russian Central Bank meeting on Friday. “The main event today is the ECB policy announcement,” said analysts at VTB Bank. “The market consensus is looking for the ECB to announce a further tapering in its bond purchases to 30 billion euros per month at the start of January next year, before expiring in September.”
The Russian Central Bank will hold a regular rate-setting meeting on Friday where it is widely expected to cut its key rate from the current 8.5 percent. A rate cut has been largely priced in by investors after annual consumer inflation slipped to a post-Soviet low of 3.0 percent in September, below the central bank’s ultimate target of 4 percent. “Given that October’s is an interim meeting .., we think that the Russian Central Bank will opt for a conservative approach and cut the rate by 0.25 percent,” Aton analysts said in a note. “In this case, the meeting will likely have no significant effect on the rouble or local debt market.” Russian stock indexes dipped slightly. The dollar-denominated RTS index was down 0.32 percent to 1,114 points, while the rouble-based MICEX was 0.25 percent lower at 2,044 points.