Rouble surges as state exporters forced to sell dollars

The Russian rouble rose to a two-week high on Tuesday after the government and the central bank put pressure on large state-owned exporters to sell dollars to stop further steep losses for the local currency.

The rouble plunged to an all-time low in mid-December on the back of lower oil prices and Western sanctions, which make it almost impossible for Russian firms to borrow from the West.

The rouble fell to as low as 80 per dollar this month, from the average of 30-35 seen in the first half of the year, but has recovered since to trade as high as 53 to the dollar on Tuesday.

Kommersant newspaper said, citing unnamed sources, that Russian prime minister Dmitry Medvedev had signed an order obliging the country's largest state exporters to sell part of their foreign currency revenues.

The paper said that in the next two months, companies may provide the market with about $1 billion per day in total in dollar sales.

The central bank said in a statement it was conducting consultations with large exporters with the aim of stabilising the currency market.

President Vladimir Putin has repeatedly promised not to reintroduce capital controls but the new measures are likely to be seen as a softer version of restrictions on capital flows.

The exporters also have to pay tax bills at the end of the month that require them to convert foreign earnings into roubles. The peak of their tax payment is expected on December 25th.

Shortly after the market opening, the rouble hit 52.88 against the dollar - its strongest level since December 8th. Later in the day it was up 1 percent at 55 to the dollar .

Reuters