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Bloomberg

The ruble sank for a sixth day, approaching a record low, as crude resumed declines and the Economy Ministry said Russia may enter its first recession since 2009 next year.

The currency slumped 2.7 percent to 52.6510 against the dollar by 1:26 p.m. in Moscow. It reached a record low of 53.95 yesterday. Yields on 10-year government ruble bonds fell five basis points to 10.70 percent before the Finance Ministry announces whether or not it will hold a debt auction tomorrow.

Russia may sink into recession in the first quarter, Deputy Economy Minister Alexei Vedev said, as the Ukraine conflict and lower oil prices take their toll on the world’s biggest energy exporter. After the ruble tumbled 6.6 percent yesterday, traders at banks including OAO Alfa Bank and National Standard Bank said policy makers may have intervened for the first time since they abandoned regular currency sales last month.

“This is now an official recognition from the government that the economic environment will be worse than originally planned,” Ivan Tchakarov, Citigroup Inc.’s Moscow-based economist, said by e-mail. “This is adding to the gloom.”

The Bank of Russia on Nov. 5 said it reserved the right to sell foreign currency unannounced in the event of a threat to the country’s financial stability, while abandoning most interventions. The central bank’s press service said in response to a request for comment today that it publishes intervention data two days after the operations occur.

“The elements of instability” hurting Russia’s economy range from the structural to the geopolitical, Vedev from the Economy Ministry said. “One of the key factors is the lower price of oil.”

Outflows Surge

OPEC, the cartel that supplies about 40 percent of the world’s crude, left its oil-output target unchanged on Nov. 27, sending oil tumbling 13 percent in London last week. Brent crude for January settlement rebounded yesterday, rising 3.4 percent to $72.54 per barrel, before falling as much as 1.1 percent to $71.75 today.

The ruble is forecast to average 49 per dollar next year, Vedev said. Net capital outflows are set to surge to $125 billion this year, more than the $100 billion predicted earlier, before slowing to $90 billion in 2015, he said.

The ruble’s 14-day relative-strength index was at 80.6, the most since Nov. 6. A reading above 70 suggests to some traders the currency may be poised to gain.