March 12, 2014 / 11:46 AM / 4 years ago

Russian finance ministry to wait before resuming fx buys - Ifax

March 12 (Reuters) - Russia’s finance ministry said on Wednesday it will wait for at least another two weeks before resuming daily foreign currency purchases to transfer excess revenues to one of its sovereign wealth funds, partly because the rouble is too weak.

The ministry indicated last month that it would convert around $5.8 billion to add to its $87 billion Reserve Fund, one of two sovereign funds financed from oil taxes.

It needs to convert the funds into foreign currency and announced a gradual transfer that would involve it buying the equivalent of 3.5 billion roubles ($95.8 million) a day over three months.

However, it halted the programme on March 4 following the rouble’s plunge to record lows against the dollar and the euro after President Vladimir Putin declared Russia’s right to intervene militarily in Ukraine.

“For now we aren’t rushing” to resume purchases, Deputy Finance Minister Alexei Moiseev was quoted as saying by the Interfax news agency.

“To be honest, it seems to us up until now that the exchange rate (of the dollar) is a bit expensive, that is we are in no hurry to buy at a rate of 36 roubles plus some kopecks.”

The dollar was worth 36.50 roubles on Wednesday , having gained 11 percent since the end of last year as the rouble has been hit by Russia’s involvement in the crisis in Ukraine and volatility in emerging markets as the U.S. Federal Reserve began scaling back its stimulus programme.

“We are now looking closely at the situation. In principle I think we will wait another couple of weeks and return to this question,” Moiseev said.

He said a decision on the mechanism for resumed foreign currency purchases would be taken by April 1. (Reporting by Jason Bush; Editing by Lidia Kelly and Susan Fenton)

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