MOSCOW, Feb 27 (Reuters) - The Russian rouble was flat

against the U.S. dollar and weakened slightly against the

Chinese yuan on Thursday, taking a pause in a rally that has

been fuelled by increased expectations of a peace settlement in

Ukraine.

At 0940 GMT the rouble was flat at 86.90 against the

dollar in the over-the-counter market, still its strongest level

since August. The rouble weakened by 0.3% to 11.98 against the

yuan, the most traded foreign currency in Russia.

The Russian currency has gained about 23% against the dollar

and 13% against the yuan this year, mostly on expectations of

better relations with the United States. Some analysts are now

predicting a correction.

"We expect a correction to the range of 90-93 roubles per

dollar after the end of the tax period in Russia. It could start

as early as this upcoming Friday ," said Vladimir Chernov from

Freedom Finance Global.

A stronger rouble is helping the central bank to tackle

inflation, which is running at 10%, but is also a risk for the

budget, which will receive reduced revenues from oil and gas

exports.

According to Reuters calculations, the rouble price for a

barrel of Russia's Urals blend of oil in February was 14.7%

lower than the figure used for the 2025 budget, mostly due to

the recent rally in the Russian currency.

The central bank linked the rouble rally to geopolitics on

February 26 and said that it was too early to evaluate the

impact of the stronger rouble on Russia's economy and inflation.