Financial Markets

    The dollar’s rally against other major world currencies last March, accompanied by a moderate decline in world oil market prices, revived market participants’ interest in dollar-denominated assets. A readjustment of price dynamics typical of the past few months was registered in some segments of the Russian financial market in March.

    In the early days of March, the dollar’s rally on the world’s currency market caused a significant rise in its nominal rate against the ruble. In the third week of the month, however, the dollar slipped back to the level registered at the beginning of the month and steadied. Over the month, the dollar/ruble rate in STS "today" trades fell 0.02% and in afternoon session for "tomorrow" trades 0.04%. The official dollar/ruble rate was 28.49 on March 31 against 28.52 on February 29. SELT dollar trade turnovers on MICEX contracted to $670 million a day in March from $876 million in February.

    Yields changed both ways on the GKO-OFZ government bond market in March. GKO yields fell by 0.3 percentage points that month and OFZ-PD yields were down by 0.9 percentage points, while OFZ-AD yields gained 0.3 points. GKO-OFZ secondary market turnovers expanded considerably in March, amounting 2,506 million rubles a day against 1,499 million rubles a day in February. Depreciation income federal loan bonds (OFZ-AD) dominated market turnovers.

    Share prices continued to rise in March. By the end of the month, the RTS index gained 83 points and MICEX index 54 points. The bond market also demonstrated a price uptrend and the activity of corporate security market operators continued to rise. The most significant rise in activity was registered in RTS, where average daily turnovers of trade in corporate securities expanded more than 15% month on month.

    There was a noticeable contraction in the ruble liquidity at commercial banks in March. The balances of commercial banks’ correspondent accounts with the Bank of Russia changed between 152 billion rubles and 232 billion rubles during the month and the average monthly balances declined to 189.2 billion rubles from 234.5 billion rubles in February. This, along with the renewed interest of market participants in foreign currency assets, led to a rise in interbank loan interest rates. The average weighted MIACR on overnight ruble loans rose to 1.8% p. a. in March against 1.2% in February.