USD/RUB bears attack 61.00 as USD stays firmer ahead of US PMIs
- USD/RUB stays depressed for the third consecutive day.
- DXY cheers hawkish Fed, mostly firmer data to extend recovery from monthly low.
- US President Biden shows readiness for more hardships for Russia.
- Firmer oil prices, ruble’s decoupling from global currencies also weigh on prices.
USD/RUB takes offers to renew intraday low around 61.00 during the initial European session on Wednesday.
The Russian ruble (RUB) pair drops for the third consecutive day amid Moscow’s policies to defend the local currency, due to sanctions from the West and the firmer oil prices, Moscow’s main export. Also weighing on the USD/RUB could be the recent chatters surrounding a delay in the total ban of Russian oil exports to the US, Europe and the UK.
On the other hand, a firmer US dollar and cautious mood ahead of the key data/events seem to restrict the quote’s further downside.
US Dollar Index (DXY) extends Tuesday’s recovery from the monthly low, up 0.26% intraday near 102.05 by the press time, as hawkish Fedspeak and mostly upbeat data recall the greenback buyers. Also underpinning the greenback could be the reassessment of market bets that previously doubted the Fed’s aggression post-September.
Elsewhere, US President also sounded harsh on Russia and exerted additional downside pressure on the bright metal. “If Russia does not pay a heavy price for its actions, it will send a message to other would-be aggressors that they too can seize territory and subjugate other countries,” said Biden per The New York Times.
It should be noted that the Central Bank of the Russian Federation (CBR) announced a surprise rate cut of 300 basis points to trigger the USD/RUB pair’s rebound during the last week. However, the bears returned to the table after the quote reversed from 68.25.
Looking forward, the US ISM Manufacturing PMI for May, expected 54.5 versus 55.4 prior, as well as hawkish Fedspeak, are eyed to forecast further downside of USD/RUB. Additionally, Russian Industrial Production and Unemployment Rate for April, prior 3.0% and 4.1% respectively, will also be important to forecast immediate moves of the pair.
Technical analysis
Unless crossing the 21-day EMA level of 65.50, USD/RUB stays on the way to the recently flashed four-year low surrounding 55.90.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
