RUB stays under pressure – Danske Bank
|Vladimir Miklashevsky, Senior Economist at Danske Bank, believes the Russian currency remains under pressure for the time being.
Key Quotes
“On 3 February, Russia’s central bank (the CBR) kept its key rate at 10.0%, in line with consensus and our expectation. Yet, the general tone of the CBR’s statement has turned more hawkish as the Ministry of Finance (Minfin) started its FX operation mechanism. The central bank stated that its ability to cut its key rate in H1 17 has diminished. We still expect the CBR to start cutting rates in Q2 17, while we expect the key rate to reach 8.0%”.
“While carry-trades and improved EM sentiment on a less hawkish than expected Fed are supporting the RUB, Russia’s economic authorities seems to be unhappy with the excessive rally in RUB, intervening both verbally and through the FX operations mechanism in order to guarantee sufficient budget incomes in RUB”.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.