Russian rouble flat vs US dollar, rally on pause

MOSCOW, Feb 27 (Reuters) - The Russian rouble was flat against the U.S. dollar and weakened slightly against the Chinese yuan on Thursday, taking a pause in a rally that has been fuelled by increased expectations of a peace settlement in Ukraine.

At 0940 GMT the rouble RUB= was flat at 86.90 against the dollar in the over-the-counter market, still its strongest level since August. The rouble weakened by 0.3% to 11.98 against the yuan, the most traded foreign currency in Russia.

The Russian currency has gained about 23% against the dollar and 13% against the yuan this year, mostly on expectations of better relations with the United States. Some analysts are now predicting a correction.

"We expect a correction to the range of 90–93 roubles per dollar after the end of the tax period in Russia. It could start as early as this upcoming Friday ," said Vladimir Chernov from Freedom Finance Global.

A stronger rouble is helping the central bank to tackle inflation, which is running at 10%, but is also a risk for the budget, which will receive reduced revenues from oil and gas exports.

According to Reuters calculations, the rouble price for a barrel of Russia's Urals blend of oil in February was 14.7% lower than the figure used for the 2025 budget, mostly due to the recent rally in the Russian currency.

The central bank linked the rouble rally to geopolitics on February 26 and said that it was too early to evaluate the impact of the stronger rouble on Russia's economy and inflation.