Posted On: October 07, 2014
The Russian ruble declined 0.5 percent to 39.9155 against the U.S. dollar this morning, Bloomberg reported. The exchange rate is a new record low for the fourth time in a month as the currency depreciated 14 percent in three days. The Russian central bank spent $1.75 billion USD over the last two trading days in an effort to support the falling currency.
"We expect the central bank to keep close watch, being wary of a potential spike in retail foreign-exchange purchases," Sberbank CIB analysts told Bloomberg.
The Russian central bank elected to shift the upper limit of the ruble's trading corridor up $0.05 USD per $350 million sold on Monday, with further movement expected Tuesday, according to Reuters. Analysts at VTB Capital Bank said the biggest risk lies in conversion of foreign currency savings. As that risk advances, the Russian central bank will likely take additional steps to stabilize the exchange rate.
Oil prices also remained a negative influence on ruble trading. North Sea Brent crude oil fell to $91.85 USD per barrel, $0.75 lower than Monday's closing price. Over the course of the year, Brent crude declined over 17 percent.
Category: Industry News
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