USD/RUB to plunge towards pre-coronavirus low at 60.8833 in 2021 – Rabobank

While the Bank of Russia (CBR) left the door open to more easing, the latest comments from Governor Nabiullina imply that a cautious approach will once again prevail and the key rate will remain on hold at 4.25% on December 18. 

Regarding the ruble, A new set of sanctions is the main source of risk in 2021 but economists at Rabobank expect the USD/RUB pair move back to 60.8833 in the next year.

Key quotes

“The sharp acceleration in inflation above the official 4% target to 4.4% YoY in November has limited room for manoeuvre for the CBR. The 5.8% YoY spike in food prices was the main culprit. Many households started stockpiling. A weaker ruble also contributed to inflationary pressure as prices of non-food goods accelerated to 4.5% YoY. The temporary nature of those factors means that inflation should ease next year. That said, Governor Nabiullina seems to be in favour of properly assessing the impact of those factors on inflation expectations before considering another rate cut, which could be the last in this easing cycle. Therefore, the most likely outcome of the December 18 meeting is an unchanged policy rate at 4.25%.”

“The ruble could be the main incentive to trim rates further next year. To maximise benefits of a gradual recovery in global demand for Russian oil and gas, the CBR may narrow the interest rate differentials to preserve the competitiveness of Russian exports by preventing the ruble from appreciating excessively.”  

“President-elect Biden is widely expected to adopt a much stronger stance on Russia than his predecessor Trump. Washington will continue exerting pressure on European partners – mainly Germany – to terminate the Nord Stream 2 project. That said, at the very beginning of his presidency Biden may refrain from confronting Putin and may first build a wider coalition with Western allies before challenging Russia.”

“The risk of sanctions is well known to market participants and should not prevent the ruble from appreciating over the 12-months, although brief periods of weakness can be expected due to changes in global sentiment. We expect USD/RUB to drift towards the pre-coronavirus pandemic low at 60.8833 in 2021.” 


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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

How do emotions affect trade?
Follow up our daily analysts guidance

Subscribe Today!    

Latest Forex News

Latest Forex News

Editors’ Picks

EUR/USD battles with 1.1700 as the market mood turns sour

Poor German data and renewed concerns about a default of the Chinese Evergrande property giant undermined investors’ sentiment, pushing them into the dollar’s safety.


GBP/USD accelerates its slump, trades around 1.3650

GBP/USD is under strong selling pressure, trimming most of its post-BOE gains. Concerns about the global financial health and slow moves towards tapering weigh on markets.


XAU/USD hangs near multi-week lows, around $1,745 ahead of Powell

Gold struggled to capitalize on its attempted intraday recovery move. Hawkish Fed/BoE, rising bond yields acted as a headwind for the metal. Resurgent USD demand exerted additional pressure on the commodity.

Gold News

PBoC imposes ban on crypto trading as it fosters ‘illegal financial activity’

PBoC bans crypto trading activities and a plethora of associated services, labeling it “illegal.” Overseas cryptocurrency exchanges providing services to Chinese residents will be investigated in accordance with the law. 

Read more

Evergrande, VIX and yields make for choppy day ahead

Equity markets remain focused on Evergrande as rumours of a possible default on overseas debt swirl. The market appears to be on the hunt for negative news, which leads us to conclude that stocks are going lower in the short term.

Read more