Moscow, – The Russian ruble weakened slightly against the US dollar and the Yuan of China on Friday and responds to the tips of the central bank that the key rate could still fall this year despite inflationary tax increases in the new draft budget. Central bank governor Elvira Nabiullina said on October 9 that there was still room for the key rate cut from the current level of 17% and that the decisions were not determined. Last month, the central bank lowered the key rate by 1 percentage point, which was smaller than expected. Many analysts expect it to interrupt extra cuts this year to reduce an inflation jump in the early 2026 linked to the VAT hike. Such expectations have supported the ruble over the past few weeks, as high interest rates make the judgments of the rouble-denominated assets more attractive. The prospects of more cuts have reversed this tendency, analysts said. “The head of the central bank sees space to lower rates in the future – it is cowardly for the national currency,” said analysts at Brokerage BCS. At 1000 GMT, the ruble weakened by 0.1% to 81.25 to the dollar, according to Lseg trade data. It weakened by 0.3% to 11.35 against the Yuan on the Moscow Stock Exchange, where the Yuan is the most traded foreign exchange. Analysts noted that the Russia’s stock market index fell by 4% on October 8 after a statement by Deputy Foreign Minister Sergei Ryabkov, that the impetus of the Alaska Summit between Russia and the US found a peace agreement for Ukraine. Ryabkov played the importance of its statements for markets and said on October 9 that “geopolitical risks are not greater than before, they are on a plateau.” There was no significant response from the ruble to the comments of the Deputy Foreign Minister. “Yesterday, the geopolitical factor weakened,” BCS analysts said, referring to Ryabkov’s latest remarks. “And this is a positive factor for the ruble.” This article was generated from an automated news agency feed without edits to text.
Russian ruble weaken after the central bank indicates at more rate cuts in 2025
