Russia to ramp up net foreign currency sales from July 7

MOSCOW (Reuters) -Russia will ramp up the amount of foreign currency it sells on a net basis in the coming month by almost a third, amid growing concern among analysts and businessmen over the strength of the rouble.

The state's net forex sales will rise 31% to 9.76 billion roubles ($124 million) a day in the coming month, following an announcement by the finance ministry on its forex transactions for the country's fiscal reserve fund on Thursday.

Under a complex set of foreign currency operations, the central bank buys and sells forex to ensure a steady supply on the domestic market and also on behalf of the finance ministry, which runs the National Wealth Fund.

The net reading of the central bank's own transactions and those it conducts on behalf of the ministry provides a figure for overall forex interventions by the state - a major factor for the rouble market.

The Finance Ministry said that for July it plans to sell 18.77 billion roubles' worth of foreign currency and gold or 0.82 billion roubles a day from the National Wealth Fund. Last month the ministry bought 28.3 billion roubles or 1.5 billion roubles a day. 

The central bank conducts its forex transactions mostly in yuan since it cannot operate in dollars and euros due to Western sanctions.

The central bank said on June 25 that it will increase its own foreign currency sales to 8.94 billion roubles a day from July 1 for the rest of the year, compared with 8.86 billion roubles previously.

By 0920 GMT, the rouble strengthened by 0.3% to 78.70 per U.S. dollar, according to LSEG data based on over-the-counter quotes.

The Russian currency is up about 45% against the dollar since the start of the year, and many analysts and businessmen say it is overvalued and needs to weaken.

The central bank's governor Elvira Nabiullina countered that view on Wednesday, saying that the currency's weakness would be a sign of economic vulnerability and that the exchange rate should not just please exporters, who benefit from a weak rouble.

The rouble hit a three-week high of 10.99 against the Chinese yuan, the most traded foreign currency in Russia ahead of the announcement.

Finance Minister Anton Siluanov said in May that the government plans to tap the fund for 447 billion roubles in 2025 to balance the budget in 2025, implying that forex sales from NWF will accelerate later in the year.

($1 = 78.7000 roubles)

(Reporting by Darya Korsunskaya, writing Gleb BryanskiEditing by Andrew Osborn and Hugh Lawson)