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. Last Updated: 07/27/2016

Dollar Buys Slow Ruble’s Weekly Rise

The Central Bank bought $4.5 billion to $5 billion this week, including $500 million to $700 million Friday, to keep the lid on ruble appreciation as the currency rallied on strong oil, the weak dollar and appetite for risk.

Friday’s interventions came despite the ruble’s weakening against the globally rebounding dollar, and weekly purchases amounted to at least 10 percent more than a week earlier, dealers said.

That marked a sixth week of the ruble rally, with the currency closing the week at 35.91 against the euro-dollar basket — the strongest level since mid-January. It finished the week at 29.61 rubles per dollar, giving back five kopeks from Thursday’s record high this year.

“Investors [are] betting on the ruble appreciation and this trade is rapidly becoming the market consensus,” Alexandra Yevtifyeva, an economist with VTB Capital, wrote in a research note.

The ruble’s rapid gains come as an unpleasant surprise for the government, which is relying heavily on hard currency revenues from exports and will see the budget deficit falling only slightly to 6.8 percent next year.

But Finance Minister Alexei Kudrin has repeatedly said he was against an artificial depreciation of the ruble.

“I think that today the dollar is fluctuating within acceptable limits to ensure the global trade and capital saving measures. So we are not worried,” he said.