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UPDATE 2-Russian rouble at strongest vs euro in over a year as oil prices surge

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(Updates prices, adds OFZ details)

MOSCOW, Sept 15 (Reuters) - The rouble soared to its strongest level versus the euro since August 2020 on Wednesday as oil prices surged past $76 dollars per barrel, sending Russia’s benchmark MOEX stock index to a record high.

By 1512 GMT, the rouble had gained 0.5% to trade at 85.67 versus the euro.

It was 0.6% stronger against the dollar at 72.50 , earlier hitting 72.4850, its strongest since June 29.

The Russian currency moved past an 11-week high versus the greenback hit in the previous session after data showed a weaker-than-expected rise in U.S. inflation last month, with investors now looking ahead to the Federal Reserve’s Sept. 21-22 meeting.

“The better-than-expected CPI print in the U.S. lowers the chance that the Fed will cut its stimulus program next week, supporting the risk-trade,” said BCS Global Markets.

The rouble received some support from inflows of foreign funds to the Russian debt market.

The finance ministry raised a cumulative 63.4 billion roubles ($874.41 million) by auctioning 10- and 20-year OFZ treasury bonds on Wednesday, while demand reached 94.6 billion roubles.

OFZs, which Russia uses to plug budget holes, have regained popularity among foreign investors as concerns about sanctions have waned and on expectations their prices could rise further once the central bank starts cutting rates at some point next year.

Brent crude oil, a global benchmark for Russia’s main export, was up 2.9% at $75.71 a barrel.

Oil dynamics were a rare bright spot in the largely negative external outlook, analysts said, after weaker-than-expected Chinese economic data reinforced worries about slowing global growth.

“Although the oil market is looking strong, we fear a downturn in the momentum of oil prices and consequently weakening support for the rouble, due to the weakness of the general market environment,” Promsvyazbank analysts said in a note.

Russian stock indexes climbed. The rouble-based MOEX Russian index was 0.3% higher at 4,069.3 points, after touching an all-time high of 4,081.98 points.

The dollar-denominated RTS index was up 0.8% to 1,768.4 points, earlier hitting 1,773.04 points, its strongest mark since August 2011.

For Russian equities guide see

For Russian treasury bonds see ($1 = 72.5058 roubles) (Editing by Mark Potter and Emelia Sithole-Matarise)

Our Standards: The Thomson Reuters Trust Principles.

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