Russia's rouble rises as cash inflow surges amidst oil export recovery 

Russia's financial landscape is experiencing an upturn as the country's current account surplus expands, bolstering the rouble despite challenging global conditions and unprecedented sanctions related to the conflict in Ukraine, Bloomberg reported on Tuesday.

The central bank's data, released on Tuesday, revealed a current account surplus of $53.8 billion for the first ten months of this year, a figure significantly lower than the 2022 record but indicative of a noteworthy recovery in the face of adversity.

The surplus in October, exceeding $11 billion for the second consecutive month, underscores the resilience of Russia's economic rebound.

The Bank of Russia, acknowledging a slight dip in exports during October, revised its estimate of the current account surplus for previous months based on additional data. This adjustment led to an upgrade in the full-year 2023 forecast from $45 billion to $60 billion.

Despite challenges, Russia's crude exports through its ports in October neared their highest level in over four months, contributing to a surge in overall oil and gas revenue, reaching levels unseen since April 2022.

The efficacy of Russia's financial strategy is particularly notable in the face of sweeping sanctions imposed by the US and its allies in response to the Ukrainian conflict. The renewed influx of cash into the country has enabled the rouble to mitigate some of its losses since the beginning of the year.

In a contentious move, the Russian government recently reintroduced certain capital controls, compelling 43 groups of exporter companies, including major oil producers, to sell their foreign earnings domestically in roubles. This decision was met with opposition from the central bank.

Inspite of the controversy, increased foreign currency sales by exporters contributed to October being the rouble's strongest month since June of the previous year, with a 5 per cent gain against the US dollar.

As a tribute to the positive financial momentum, the rouble continued its ascent on Tuesday, trading below 91 against the dollar in Moscow, the first time since late July.

(With inputs from Bloomberg)

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