May 27 Reuters The Russian rouble extended its losses on Friday after plunging the previous session as the central bank slashed interest rates, signalling more cuts to come, and the prospect of easing capital controls and a possible sovereign default hammered the currency.

The rouble slumped around 10 to the dollar and euro on Thursday as the central bank cut its key rate to 11, the third 300basispoint cut in a row, as inflation slows from more than 20year highs. 

At 0727 GMT, the rouble was 2.1 weaker against the dollar at 66.63 , a more than twoweek low. On Wednesday, the rouble had hit its strongest level since February 2018 of 55.80 against the greenback.

Versus the euro, the rouble lost 4.4 to trade at 70.99 , tumbling further away from the sevenyear high of 57.10 hit on Wednesday.

Propped up by capital controls, the rouble had artificially risen to become the world39;s bestperforming currency so far this year. New gas payment terms requiring conversion of foreign currency into roubles and a fall in imports have also helped.

But it has now lost the support of the monthend tax period that usually sees exportfocused companies convert foreign currency into roubles to pay local liabilities.

Economy Minister Maxim Reshetnikov on Thursday said the currency39;s strength, which has raised concerns about the negative impact on Russia39;s budget revenue from exports, was making Russian goods uncompetitive abroad.

He expects the mandatory proportion of foreign currency…