The Russian rouble shrugged off Tuesday's announcement of Russia's new cabinet, as President Vladimir Putin's proposed shake-up saw many former ministers stay in their posts. The rouble remained weaker against the dollar on the day against a background of low global risk appetite after concerns about a new strain of coronavirus emerging in China spooked investors.
Speaking on state television shortly after naming his former economy adviser Andrei Belousov as first deputy prime minister, Putin said his government shake-up had been big, but that many ministers from his old government had kept their jobs.
The heads of the finance, defence, foreign and energy ministries all remained in government, with former Perm region governor Maxim Reshetnikov taking over as economy minister. Dmitry Medvedev resigned as prime minister last Wednesday after Putin proposed constitutional changes that would give him scope to extend his grip on power after leaving the presidency in 2024, with the little-known Mikhail Mishustin taking over.
Alfa Banks analysts had said before the government announcement that it should allow the market to "resume growth". By 1718 GMT, the rouble was 0.4% weaker at 61.79 against the dollar, having earlier slipped to 61.97, and had fallen 0.3% to trade at 68.56 to the euro.
The rouble has chances to recover to 61 versus the dollar later this week thanks to the tax payments, Rosbank said in a note. Russian stock indexes were down, but had recovered some of their earlier losses. The dollar-denominated RTS index was down 0.8% to 1,634.3 points, while the rouble-based MOEX Russian index was 0.3% lower at 3,209.2 points after having hit a record high on Monday. Domestically, the rouble was being shielded from further damage by month-end tax payments that prompt export-focused companies to convert foreign currency revenues to meet local liabilities.
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