Russian rouble strengthens as Russian, US officials start talks in Saudi Arabia

MOSCOW, March 24 (Reuters) - The Russian rouble strengthened on Monday as U.S. and Russian officials began talks in Saudi Arabia aimed at making progress towards a broad ceasefire in Ukraine.

By 0930 GMT, the rouble was up 1% at 83.60 against the dollar in the over-the-counter market. The rouble underwent a correction last week, losing about 4% against the dollar in two days, but has still gained more than 26% this year.

The rouble's rally since the start of the year has been fuelled by expectations of a peace settlement in Ukraine and easing of tensions between Russia and the United States.

A high key interest rate, which the central bank kept on hold last Friday, is also supporting the rouble.

Against the Chinese yuan, the most traded foreign currency in Russia, the rouble was up 0.5% at 11.41 on the Moscow Stock Exchange.

"This week, we allow for the possibility of a new wave of strengthening of the rouble. By Tuesday, another round of positive geopolitical news is not excluded," said Denis Popov from PSB bank.