Russian Firms Lost Billions on Ruble Derivatives, Interfax Says - Bloomberg

Russian Firms Lost Billions on Ruble Derivatives, Interfax Says - Bloomberg:



"Russian companies lost tens of billions of rubles on foreign-exchange derivatives amid a rout in the ruble, Interfax reported, citing Sergey Moiseev, the head of financial stability at the central bank.



Companies were forced to close out the contracts after the central bank’s move to a free-floating exchange rate exposed them to the world’s highest currency volatility amid a slump in oil prices, Moiseev said, according to Interfax. Most of the transactions were terminated ahead of schedule, triggering penalties, or were restructured, the report said.



The losses underscore the financial risks of the ruble’s 32 percent retreat during the past three months, which has also fueled inflation and may prompt the central bank to increase interest rates today. Swings in the currency surged after the Bank of Russia last month accelerated a plan to allow it to trade freely in a bid to preserve foreign reserves as crude oil fell to a five-year low."



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