Yeltsin vows to defend rouble

Click to follow
The Independent Online
THE RUSSIAN stock market yesterday rebounded from Thursday's dramatic plunge, lending much-needed relief to the London and European bourses and Wall Street, after President Boris Yeltsin vowed not to devalue the rouble, writes Francesco Guerrera.

Financial markets were also buoyed by news that the Group of Seven leading economies were to meet to consider ways to help Russia.

"There will be no devaluation - that's firm and definite," the Russian President told reporters.

Mr Yeltsin's intervention came only hours after George Soros, the speculator, who two days ago created havoc on the world's financial markets with his call for a devaluation of the rouble, tried to distance himself from the collapse in Russian stocks. "The turmoil in Russian financial markets is not to due to anything I said or did," the Hungarian-born financier said in a statement.

Mr Soros said his fund had not speculated on the rouble falling in value and had "no intention of shorting the currency".

The two statements soothed Russian traders' jittery nerves and triggered a 13.7 per cent jump in share prices. The rise helped the benchmark RTS index to recoup part of Thursday's 28.7 per cent loss.

In New York, the Dow Jones Index was up 37 points in early trading after losing the gains from a 100-point spike. The FTSE 100 Index closed up 55.5 points at 5,455.0. Germany's DAX rose 1.71 per cent, and Paris's CAC-40 was up 1.09 per cent.