Monday 18 August 2014

Russia Widens Ruble Basket to Complete Free Float by End of Year - Bloomberg

Russia Widens Ruble Basket to Complete Free Float by End of Year - Bloomberg:



"Russia is making its currency more flexible by widening the range in which it trades freely and reducing the amount of foreign exchange bought and sold by the central bank.



Russia widened the band in which the ruble trades against the target basket of dollars and euros to 9 rubles from 7 rubles previously, the central bank in Moscow said in a website statement. The regulator also abandoned all interventions while the ruble is trading in the band. It used to buy or sell $200 million per day at certain levels.



The changes are intended to help complete the switch to a freely floating ruble from the current managed rate by the end of this year, which is needed to shift to inflation targeting, the central bank said. Policy makers are loosening their hold on the ruble even as volatility rises and inflation risks increase because of Ukraine-related sanctions."



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