Russian Ruble Climbs

The ruble rose to a one-week high against the dollar on Monday, boosted by the start of a favorable month-end tax period, as oil prices fell and the threat of geopolitical risk loomed over Russian markets.

The ruble was 1.1% stronger against the dollar, trading at 61.41, its highest level since Oct. 10. It rose 0.6% against the euro to 60.35 and 1.6% against the yuan to 8.47, a near two-week high.

Export-oriented businesses typically convert foreign exchange earnings into rubles to pay domestic tax liabilities, thereby supporting the Russian currency.

The ruble has been the world’s best-performing currency this year, aided by capital controls and a drop in imports after Western governments imposed harsh sanctions on Russia for its actions in Ukraine and scores of foreign firms suspended operations in the country.

The RTS index in US dollars was up 2.3% to 1,013.3 points. The ruble-based MOEX Russian index increased by 1.3% to 1,977.1 points.

USD, Metals, and GBP

The dollar is at its highest since 2000, having risen 22,4% against the yen, 13,3% against the euro, and 6,5% against emerging market currencies since the beginning of the year. Given the dollar’s dominance in international trade and finance, such a sharp dollar strengthening in months has significant macroeconomic implications for almost all countries.

Spot silver increased by 3.25% to $18.85 per ounce. Moreover, Platinum increased by 2.03% to $917.01. Palladium increased by 1.92% to $2,027.18. After falling more than 3% last week in its worst performance since July, spot gold was up 1.46% at $1,666.39 per ounce. Gold futures in the United States rose 1.39% to $1,671.90.

GBP/USD held steady on Monday after retreating from resistance levels before the weekend. The resistance levels at 1.1405 and 1.1414 may remain in place. The dollar fell 0.1% against its peers, making gold more affordable for buyers holding other currencies.

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