Russian Economic Development Minister Maxim Reshetnikov attends a session of the St. Petersburg International Economic Forum (SPIEF) in Saint Petersburg, Russia June 19, 2025. REUTERS/Anton Vaganov

MOSCOW, Dec 2 (Reuters) - The Russian rouble will be stronger than previously expected, which represents a challenge for the economy and some exporters, Economy Minister Maxim Reshetnikov said on Tuesday.

The rouble rallied by over 40% in the first half of the year due to the central bank's tight monetary policy and expectations for a peaceful settlement in Ukraine, following the start of U.S.-Russia negotiations in February.

Most analysts and businessmen expected the rouble to weaken in the second half of the year, arguing that the Russian currency's fair value was around 100 to the U.S. dollar, down from the current level of 77.5 to the dollar.

Reshetnikov said that due to weak imports and capital outflows, the stronger rouble was expected to stay, and companies had no choice but to adjust to it.

"Strategically, the exchange rate will be stronger than it seemed to us one or two years ago," Reshetnikov said. The government changed its forecast for the average rouble rate in 2026 from 95.9 to the dollar to 100.2 last August.

Reshetnikov said that the government's policy of import substitution, which was introduced to counter Western sanctions and replace equipment and machinery previously imported from the West, was also working to strengthen the rouble.

"We will have to live with these new realities," Reshetnikov added, stressing that several large export-oriented projects under development with support from the government targeted export volumes of up to $70 billion.

He said that some of these exports would not be profitable at the stronger exchange rate of the rouble and would have to be abandoned.

"Some enterprises are expecting that they just need to wait a little longer and by some miracle the exchange rate will weaken. This strategy is no longer working," Reshetnikov said.

(Reporting by Gleb Bryanski; Editing by Mark Trevelyan/Guy Faulconbridge)