MOSCOW, Aug 6 (Reuters) - The Russian rouble and markets

held their breath on Wednesday as they awaited the outcome of

President Vladimir Putin's meeting with U.S. special envoy Steve

Witkoff at the Kremlin.

Witkoff and Putin had "useful and constructive" talks, a

Kremlin aide Yuri Ushakov said, two days before the expiry of a

deadline set by President Donald Trump for Russia to agree to

peace in Ukraine or face new sanctions.

The rouble was flat at around 80 to the dollar, according to

data compiled by LSEG based on over-the-counter quotes. It

weakened by 0.2% against China's yuan at the Moscow Stock

Exchange. Russia's main stock market index was down 0.15%.

"The market is awaiting the outcome of the meeting between

Vladimir Putin and Steve Witkoff," T-Bank's analysts said.

Many analysts believe that the rouble is overvalued and

awaiting a trigger to weaken.

The Russian currency rallied by up to 45% against the dollar

earlier this year, partly thanks to expectations of a thaw in

the relationship between Russia and the U.S. as well as hopes

for a peaceful settlement in Ukraine.

Options on the table for Trump to put more pressure on

Russia if Witkoff returns empty-handed include new sanctions

against Russia's energy and banking sectors and possible

sanctions or trade tariffs on buyers of Russian oil.

Kremlin earlier said that Russia had developed an immunity

to sanctions thanks to long experience. However, the latest

round of U.S. sanctions against a Russian bank, which handled

payments for energy, imposed last year, led to the rouble's

slide.

"In the coming days, the currency market will be waiting for

news from the visit of the U.S. President's special

representative and clarification of the situation regarding

possible U.S. sanctions," said PSB Bank's Evgeny Loktykhov.