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Ruble Rate to Pass CBR Corridors
The Central Bank of Russia (CBR) played yesterday the November 11 scenario by again allowing the ruble to depreciate 1 percent to bi-currency basket. As a result, today’s dollar costs 0.1 ruble more and the euro price has surged by 0.39 ruble. With these rates maintained, the CBR’s corridor for ruble fluctuations will widen by 8 percent to 10 percent by this year-end and by 14 percent to 15 percent by the end of March vs the pre-crisis level. With the current oil prices and the payment balance condition, the national currency is depreciating instead of appreciating within the corridor.
For the second time in November, the CBR confirmed that it has finally adopted and sticks to the course towards the governed devaluation/depreciation of the national currency. Yesterday, for instance, the CBR withdrew its support when the bi-currency ($0.55+ˆ0.45) basket cost 30.7 ruble.
The similar halt of sales by the CBR was last noticed November 11, when the national currency depreciated to 30.4 ruble to bi-currency basket. By that move, the CBR apparently unofficially fixed new parameters for the ruble fluctuations’ corridor – 1 percent up vs the previous support, i.e. roughly 0.6 ruble.
Today’s rates of exchange show the fluctuation could be even 0.9 ruble, i.e. 3 percent up vs October. The basket cost peaked to 30.99 ruble from time to time yesterday, the November 25 rates stand at 27.66 ruble/$ and 34.91 ruble/ˆ.
Given that the CBR with its reserves of roughly $450 billion is still the key player on the foreign exchange market of Russia, its yesterday’s actions allow to speak of controlled devaluation, at least in the environment of today’s exports of raw and crude oil. “The decision of the Bank of Russia signals monetary authorities will rather stick to the policy of smooth depreciation of the ruble,” concluded analysts of Renaissance Capital.
Should the smooth scenario be implemented, the bi-currency basket would cost 35 ruble by end-March, i.e. 15 percent up vs. September. With the cross-exchange rate of 1.25 $/ˆ , the dollar would cost roughly 31.8 ruble and euro would equal 39.8 ruble.
www.kommersant.com
All the Article in Russian as of Nov. 25, 2008
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