Russia's Central Bank said on Monday its decision to raise rates for foreign exchange repos was not aimed at limiting ruble strength but prompted by a "normalization" of the market and a reduced threat to financial stability.
The ruble fell earlier on Monday after the Central Bank said it was raising the rate at which it lends foreign currency to banks through repo auctions, its second such move this month.
"In general, the increase of rates may induce banks to search more actively for alternative sources of financial resources both on the domestic market and abroad," the Central Bank said in an e-mailed comment.
The Central Bank will raise its rates for foreign exchange repos as of April 21 by LIBOR plus 2.5 percentage points for one-year repos and by LIBOR plus 2 percentage points for one-week and 28-day repos.
At 5:39 p.m., the ruble was around 2.1 percent weaker against the dollar at 53 after opening some 0.9 percent higher.
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.
