VLADIVOSTOK, Russia, Sept 4 – The Russian rouble slipped against the U.S. dollar on Thursday after the head of Russia’s largest bank, Sberbank, predicted the currency will gradually weaken by the end of the year in response to the central bank’s potential rate cuts.
The rouble weakened by 0.4% to 81.30 against the U.S. dollar by 1600 GMT, its lowest level since July 31, according to data compiled by LSEG based on over-the-counter quotes. It was down 0.5% against China’s yuan on the Moscow Stock Exchange.
“If there is a reduction in rates, then I think there will be a gradual decrease in the exchange rate,” Sberbank CEO German Gref said at an economic forum in the far eastern city of Vladivostok.
“According to our estimates, the exchange rate should weaken by the end of the year, which will reduce risks for exporters and the budget,” he added.
The central bank’s board will next decide on the key rate level on September 12. The bank’s deputy governor, Alexei Zabotkin, said this week that Russia had made substantial progress in fighting inflation but urged caution.
The central bank hiked the key rate to 21% last year, the highest level since the early 2000s, to bring inflation down. It cut the key rate to 20% in June and then to 18% in July. Gref said he expects the key rate to reach 14% by the end of the year.
This article was generated from an automated news agency feed without modifications to text.
