USD/RUB back to pre-war levels meanders around 83.5000s
|- The Russian rouble recovered to pre-war levels after a steeper depreciation of 70%.
- A mixed market mood keeps the USD/RUB within Friday’s levels.
- USD/RUB Price Forecast: Technically is upward biased but would be subject to market sentiment and developments around the Russo-Ukraine war.
The USD/RUB barely advances in the North American session, though it remains near pre-war levels, before a steeper surge that sent the pair to a multi-year-high around 154.24. At the time of writing, the USD/RUB is trading at 83.7570, contained within Friday’s high/low at 86.3461/81.7161, respectively.
Market sentiment fluctuates, though putting a lid on the USD/RUB
The market sentiment is mixed, as European bourses record losses while US ones fluctuate. The Russo-Ukraine conflict dominates the headlines as the war is set to extend for a sixth week and weighs on energy and food prices. That would spur global inflation, which, added to supply chains issues and elevated commodity prices, begin to paint a stagflation scenario.
Meanwhile, on Monday, the Russian Chief Negotiator said Russia’s stance on Crimea and Donbas remains unchanged and negated that a draft peace agreement exists. He added that talks would resume on Monday. The Russian Foreign Minister Lavrov stated that Russia does not rule out charging in Roubles for other commodities if “hostility continues from the West.”
Of late, NATO’s Secretary General Stoltenberg said that what is going on in Ukraine is not an actual withdrawal of Russian troops via Reuters.
The German Chancellor Scholtz stated that the West would agree on further Russian sanctions in the coming days.
In the meantime, the US Dollar Index, a gauge of the greenback’s value vs. a basket of peers, rises 0.26%, sits at 98.830, following Friday’s US Nonfarm Payrolls report, even though missed expectations, was solid. Also, the US ISM Manufacturing Index came lower than expected, but Manufacturing Prices rose to 87.1, higher than the 80 estimated, further cementing the case for a 50-bps Fed rate hike.
Therefore, the USD/RUB pair would still be subject to developments in Eastern Europe. Any hints of the progress of talks, Russian troops withdrawal, or cease-fire agreements could be a headwind for the USD/RUB; otherwise, the uptrend could resume short to medium-term.
USD/RUB Price Forecast: Technical outlook
The USD/RUB is contained within the 81.7161-86.3461 range, and if it stays inside those boundaries, it could mean the pair might consolidate. Nevertheless, it is worth noting that the USD/RUB exchange rate is stills above the 200-day moving average (DMA), which sits at 78.1428, maintaining the uptrend bias intact.
That said, the USD/RUB first resistance would be 86.3461. Breach of the latter would expose March 30 daily high at 87.7500, followed by the 92.3961 50-DMA.
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