USD/RUB pierces off 100.00 to extend pullback from record top as Russia-Ukraine peace talks loom
|- USD/RUB takes offers to print the second consecutive daily losses.
- Diplomats from Kyiv-Moscow eye Thursday’s talks to propose ceasefire.
- Russia slapped 30% duty on FX purchase by individuals, key rating agencies downgrade Moscow.
- Fed’s Powell, US data and geopolitics are the key catalysts.
USD/RUB remains on the back foot around $98.00, per Reuters, as traders brace for Thursday’s European session. In doing so, the Russian ruble (RUB) pair stretches the previous day’s U-turn from record top.
The reason could be linked to the market’s anxiety over the likely Russia-Ukraine meeting on Thursday as the diplomats are showing readiness for talks on ceasefire despite Moscow’s military aggression. Recently, Ukrainian authorities confirmed Russia’s capture of southern city Kherson.
The geopolitical concerns triggered an exodus of funds from RUB, which in turn propelled the USD/RUB prices to the all-time high on Wednesday. However, the government levied 30.0% duties on the individual purchase of foreign currencies versus the ruble to slow down the fall of the struggling currency.
Even so, rating downgrade by Moody’s and Fitch join Fed Chair Jerome Powell’s hawkish testimony to keep USD/RUB bulls hopeful.
That said, the market’s recently cautious optimism also underpins the USD/RUB pullback. To portray the mood, stock futures print mild gains while the US 10-year Treasury yields remain sluggish.
Moving on, USD/RUB moves depend upon today’s peace talks as a positive outcome may extend the latest declines.
Technical analysis
Overbought RSI conditions favor a pullback towards the previous record top, marked in January 2016 around 86.00. However, fundamentals and bullish MACD signals contrast the previous technical details, which in turn keep buyers hopeful.
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