Ruble decreases on the completion of the tax payments period

On Tuesday there was a slight decrease of the Russian ruble against the dollar. The reasons were the coming completion of a beneficial tax payment period at the end of the month and investors' waiting for the central bank's interest rate decision this week.

Foreign-currency earnings are exchanged for rubles at the end of the month for domestic tax payments. This is relevant to export-oriented companies. At such a time, the tax period supports the ruble exchange rate.

Analysts at Promsvyazbank point out a gradual decrease in support for ruble positions as the end of tax payments approaches.

On Friday the central bank decision on the interest rate is expected. Market is waiting. The Reuters agency interviewed analysts, and most of them expect the rate to stay at 7.5%.

Alfa Capital's portfolio manager Evgeny Zhornist said it's a high probability that the Bank of Russia will take a cautious position to collect all data and to assess options.

He added that next year it is possible to expect a renewal of the rate reduction cycle due to decreasing business activity and confidence, falling Russian GDP and a strong ruble. All this contributes to a soft monetary policy.