Ruble amid panic markets and falling oil

2024 Author: James Gerald | [email protected]. Last modified: 2023-12-17 14:00

Despite the fact that in the first quarter of 2020 the ruble was predicted to have a “bright future”, at the moment the “Russian” is between a rock and a hard place - on the one hand, he is under pressure from pessimism in the markets of risky assets, and on the other, by falling oil prices. Do not forget about the policy of the Ministry of Finance, which continues to buy foreign currency within the framework of the budgetary rule.

The situation with the ruble exchange rate depends on complex external factors and can change at any time. Follow the news of the foreign exchange market on thematic financial portals or on the InstaForex website.

Markets reduced nervousness

The positive news is the decrease in the level of panic in the markets, even in the Asian ones. The death toll from the virus is on the rise, but some analysts believe the disease will ultimately not hurt markets significantly. At least to the extent that pessimists had previously assumed. Whether this is true or not is still unknown, so any news about the virus can improve or, conversely, worsen the general mood.

Risk is still out of trend

Nevertheless, some investors still continue to transfer finances into defensive assets, fearing an unstable situation and the lack of long-term forecasts. The ruble, being an attractive highly profitable currency, belongs to risky assets, and against the background of the nervousness of the markets it is losing demand. The dollar, in turn, is getting an incentive to strengthen amid growing interest in defensive assets.

Will OPEC + the crane

The oil market is trying to recover from the falls the day before, but so far the "black gold" of the North Sea mark has barely hit the mark of $ 55 per barrel, and the American oil is a psychologically important barrier of $ 50.

The OPEC + meeting will take place this week, at which the exporting countries will once again discuss the possible limitation of production to maintain prices. Forecasts of a possible drop in demand for hydrocarbons in the first half of 2020 do not add optimism, as well as the uncertainty of how badly the coronavirus will ultimately hit the economy and the manufacturing sector.

What will happen to the ruble by spring

Much depends on whether oil manages to recover, whether risk appetite returns to the markets. And this, in turn, depends on the situation with the spread of the virus.

With optimistic forecasts, the ruble will be able to stay close to the current rate, but if there are no reasons for strengthening, by March the “Russian” may show the rate of 64-65 per US dollar.