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Tags: ruble | ukraine russia talks

Savaged Ruble Holds Tentative Gains After Ukraine Crisis Talks

ruble
(Getty Images)

Thursday, 10 March 2022 09:06 AM EST

The ruble saw a tentative bounce in both Moscow and international FX markets on Thursday after the first formal talks between Russia and Ukraine's foreign ministers, even though the meeting made no progress on a ceasefire.

At 1350 GMT, the ruble had risen to just over 116 per dollar from an earlier all-time low of 121 on the Moscow Exchange used by major Russian banks. Stock markets there remain shut.

Against the euro it climbed to 121 per euro from as low as 132.4,, while in internatinoal markets such as London where trading is now ringfenced, it was showing at 116 to the dollar and 133 to the euro.

The ruble "opened a bit higher and has held there," TD Securities' Head of Emerging Markets Strategy Cristian Maggio said. "But I don't think we have seen any change in trend."

"I believe we are set for a long conflict here, which is negative for all assets."

Talks in Turkey on Thursday between top Russian and Ukrainian diplomats Sergei Lavrov and Dmytro Kuleba yielded little visable progress.

Lavrov repeatedly lashed out at the West, accusing Western countries of inflaming the situation by arming Ukraine. Asked if the conflict could lead to nuclear war, he said: "I don't want to believe, and I do not believe, that a nuclear war could start."

Kuleba said there had been no promise of a ceasefire to allow aid to reach civilians.

The fierce impact of economic sanctions on Russia have seen the ruble lose over a third of its value over the last 10 days. Stock markets have been closed since Feb. 25, while worries about a government debt default is rising.

"There is a pretty wide spread between [Moscow Exchange] pricing and what you would see in the West, so that gives you very little confidence about the level," TD Securities' Maggio said.

There were also more global sanctions and restrictions on Thursday.

Britain imposed sanctions on another list of wealthy Russians including Chelsea Football Club owner Roman Abramovich , while the Bank for International Settlements -- the main global central bank umbrella group -- suspended Russia's central bank from all its meetings and services.

Markets are also keeping a close eye on debt repayments due from the country with the specter of Russia defaulting on $40 billion of external bonds - which would be its first major such default since the years following the 1917 Bolshevik revolution - looming large.

IFR reported that Russian state-owned oil company Rosneft paid back a bond in U.S. dollars on Wednesday while Norilsk Nickel, the world's biggest nickel and palladium producer, also made a payment on a U.S. dollar bond, according to sources.

Moscow must make $107 million in coupon payments on two hard-currency sovereign bonds on March 16.

© 2024 Thomson/Reuters. All rights reserved.


StreetTalk
The ruble saw a tentative bounce in both Moscow and international FX markets on Thursday after the first formal talks between Russia and Ukraine's foreign ministers, even though the meeting made no progress on a ceasefire.
ruble, ukraine russia talks
462
2022-06-10
Thursday, 10 March 2022 09:06 AM
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