Russia FX/Rates Snapshot - June 20, 2019
The ruble's reaction to the Fed was muted, and most of its appreciation yesterday owed to demand for OFZs. This morning, it has firmed 0.8% versus the dollar, in line with other EM currencies, on improved global sentiment and a decline in US short-term rates amid growing confidence in Fed rate cuts. USD/RUB has breached very strong support at 63.6. If it settles below this level today, the path to the next key support level of 62.2 will open up. However, we have our doubts that the ruble will be able to sustain its rally given the surge in FX turnover this morning, which suggests a pickup in demand for hard currency. So, given how sharp the dollar's move was this morning, we believe the ruble could lose its footing, with USD/RUB possibly pulling back to settle around 63.6.
Sberbank CIB Investment Research is a research firm offering equity, fixed income, economics, and strategy research. It covers analysis on all aspects of Russia’s capital markets, issues and industries. The firm analyzes trends in Russia and combines local knowledge with a global perspective. It processes macroeconomic data, market and company-specific news, stock quotes and other information for providing research reports. The firm provides details and latest prices on the most traded names and most traded paper on all segments Russian market. In strategy research, it provides thematic research, tips and descriptions of the methodology used to evaluate companies.
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