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By Bloomberg

The ruble declined for a second day amid speculation policy makers will cut borrowing costs on Monday as investors await guidance on the central bank’s plans to buy foreign exchange.

The ruble fell 0.6 percent to 55.141 per dollar as of 10:45 a.m. in Moscow before the policy meeting. The currency has gained 10 percent against the dollar this year, the best performance globally, prompting officials to say the advance had gone too far.

The Bank of Russia may reduce its key rate for the fourth time this year on Monday as inflation slows and policy makers seek to shore up the economy, a Bloomberg survey showed. The ruble has tumbled 11 percent since May 13 when the central bank started buying foreign exchange. Governor Elvira Nabiullina plans to boost reserves to $500 billion and has spent about $3.8 billion in the current round of purchases.

“The market is pricing in a rate cut of about 1 percent as investors await more clarity on the central bank’s rates and intervention plans,” Andrey Vashevnik, the chief investment officer at R&B Investment Fund Ltd. in Moscow, said by phone.

A 100 basis-point cut would bring reductions this year to 550 basis points after a 650 basis-point emergency increase in December to stem the ruble’s slide. Goldman Sachs Group Inc. expects the Bank of Russia to cut the key rate by 150 basis points, according to an e-mailed note.

“The impact of foreign-currency purchases on the exchange rate and, hence, on inflation logically restricts the speed of rate cuts that would be consistent with reaching the inflation target in 2017,” Goldman economists Clemens Grafe and Andrew Matheny said in an e-mailed note.

Five-year government bonds rose, pushing the yield three basis points lower to 10.96 percent. The dollar-denominated RTS Index retreated 0.7 percent to 943.42. The Micex Index of stocks was little changed. OAO Surgutneftegas preferred shares rose 2.2 percent.

Russia equity funds lost $66 million in the week through June 10, Sberbank CIB said in an e-mailed note, citing EPFR Global data. Brent crude was little changed at $63.81 a barrel.