Russia is to spend more than Rbs113bn ($1.9bn) in the next month in an effort to weaken the rouble, marking a reversal from the 2014 currency shock that forced it to intervene heavily to stop the rouble falling too far.
The country’s central bank will spend Rbs6.3bn ($110m) a day on forex transactions from February 7 to March 6, the finance ministry said in a statement on Friday. The move follows a steady rally in the rouble as the oil price has picked up.
Analysts had expected the intervention to range between between $90m and $130m a day, well below the $200m a day the central bank spent for two months in 2015.
Russia announced plans to build up its forex reserves last week to prevent rising oil prices from strengthening the currency, propping up its rouble denominated budget spending.
The finance ministry had said purchases would continue as long as oil prices remain above $40 a barrel and it would sell forex if oil prices sank below that mark. The government would also implement a new “budget rule” mandating storing excess oil revenue as foreign currency reserves rather than spending it, in an attempt to reduce the deficit.
Economists at BCS said the move was unlikely to have a big impact on the currency, and the effect “could be neutral”. The trend in the currency is likely to be “primarily determined by external factors”, it said.