Moscow Exchange plans to restart early morning FX trading in September

By Alexander Marrow

MOSCOW (Reuters) -Moscow Exchange, Russia's largest bourse, on Friday said it intends to restart early morning trading for currencies and derivatives in September and to widen the trading hours of the Chinese yuan before the end of the year.

Demand for the yuan in Russia has increased since Feb. 24 when Russia sent tens of thousands of troops into Ukraine and the West imposed sweeping sanctions on Moscow, limiting its access to the dollar and euro markets.

"The use of the dollar and euro in the Russian economy is high, but we are seeing a gradual rise in interest in the yuan," Yana Pleshkova, head of sales in Moscow Exchange's FX market department, told reporters. "Its share in spot-market transactions now exceeds 10%."

Pleshkova said the exchange was considering increasing trading hours for the yuan and adding more currencies, such as the Uzbek sum, before the end of the year.

Russia's main trading hours are between 0700 and 1600 GMT. The earlier trading session begins at 0350 GMT and was introduced in March last year as part of an effort to attract more Asian investors.

Pleshkova also said the exchange planned to gradually return to its standard trading schedule. Trading suspensions and Russia's decision to bar foreign investors from its markets severely disrupted the country's financial sector since the conflict in Ukraine began.

Moscow Exchange on Thursday said it planned to relaunch the evening session on its stock market in September, which runs from 1600 GMT to 2050 GMT.

However, Dmitry Skryabin, a portfolio manager at Alfa Capital, said increased hours would lead to volatile trading in the evening.

"Prices are unlikely to be affected in the main session, however in the evening there will be sharper price movements due to lower liquidity," Skryabin said.

(Reporting by Alexander Marrow; Editing by Hugh Lawson and Emelia Sithole-Matarise)