Russia's rouble traded slightly lower early on Monday as oil prices slipped, but there was little market movement ahead of a rate decision by the US Federal Reserve later in the week which could send shockwaves through emerging markets. At 0740 GMT, the rouble was 0.1 percent weaker against the dollar at 68.01 and lost 0.2 percent to trade at 77.13 versus the euro.
Brent crude oil, an important driver for all Russian assets, was 1 percent weaker at $47.7 a barrel. "Local drivers for the rouble will take on a secondary importance in the coming week, the decision by the Fed on interest rates will be the main newsmaker," Moscow-based analysts at Rosbank said in a note. The outcome of the US Fed rate meeting will be revealed on Thursday, and markets on Monday were still guessing whether the Fed will hike rates for the first time in nearly a decade.
A rate increase would tend to bolster the US dollar and pressure emerging market currencies such as the rouble. Russia's central bank kept its main lending rate on hold at its latest monetary policy meeting on Friday, putting concerns about stubbornly high inflation before worries about a slumping economy. Russian share indexes edged higher on Monday. The dollar-denominated RTS index was up less than 0.1 percent to 799 points, while its rouble-based peer MICEX traded 0.4 percent higher at 1,725 points.
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