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Russian rouble volatility seen unchanged in October - central bank
October 14, 2016 / 9:01 AM / a year ago

Russian rouble volatility seen unchanged in October - central bank

MOSCOW, Oct 14 (Reuters) - Russian market players do not expect volatility in the rouble exchange rate to increase in October, the Russian central bank said on Friday.

The rouble enjoyed demand from foreign investors in September but was resilient to sharp swings in prices for oil, the country’s key export, the central bank said in a monthly report on banking sector liquidity.

The rouble moved between 62.64 and 66 against the dollar in September, firming by 3.8 percent by the end of the month compared with the end of August.

Foreigners were buying the rouble to invest in Russian assets. Inflows of foreign funds into Russian treasury bonds known as OFZs rose seven-fold in September compared with August, the central bank said.

Demand for Russian corporate bonds was also substantial at home, but Russia’s placement of a sovereign Eurobond in September created favourable conditions for corporate borrowers to tap global capital markets, the central bank said.

The Bank of Russia said it was ready to address excess liquidity in the banking system by holding regular deposit auctions until the end of the year.

The central bank reiterated that inflationary expectations still remain above its inflation target of 4 percent, which suggests the central bank would like to keep its monetary policy tight for longer to rein in inflationary expectations.

Reporting by Elena Fabrichnaya, Writing by Andrey Ostroukh, Editing by Alexander Winning

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