fxs_header_sponsor_anchor

News

USD/RUB to push modestly higher in the coming months – Lloyds Bank

Analysts at Lloyds Bank suggests that a combination of looser monetary policy and the need to rebuild both foreign exchange and central government reserves will push USD/RUB modestly higher in the coming months.

Key Quotes

 “Sharp swings in crude oil prices made the Russian ruble the second most volatile EM currency over the past month, just behind the South African rand. More recently, increased geopolitical risk related to Russian military involvement in Syria have added to the possibility of further unexpected gyrations against the US dollar.”

“Nevertheless, we hold to our core belief that a combination of looser monetary policy and the need to rebuild both foreign exchange and central government reserves will push USD/RUB modestly higher in the coming months. The Russian finance ministry announced in April that it would increase FX purchases from 3.2bn to 3.5bn rubles a day. Meanwhile, in March, the Russian central bank surprised markets by cutting its policy rate by 25bps to 9.75%. The CBR estimates that the “neutral” interest rate for the economy lies between 2-3%. Therefore, even if crude oil prices rise from current levels we would expect them to be matched by lower policy interest rates.”

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.


RELATED CONTENT

Loading ...



Copyright © 2024 FOREXSTREET S.L., All rights reserved.