On Wednesday, March 25, the Russian currency shows mixed dynamics on the Moscow Exchange. At the beginning of trading, the dollar fell by 1.7% to 76.9 rubles, and the euro fell by 1.3% to 83.4 rubles. However, in the second half of the day the values slightly increased - up to 78.4 and 84.7 rubles, respectively.
The official exchange rate of the Central Bank on March 26 was set at 77.79 rubles per dollar and 84.15 rubles per euro.
According to analysts, the uncertainty in world oil prices had an effect on fluctuations in the exchange rate. At the beginning of the session, the cost of Brent crude on the ICE exchange in London grew by 4% - to $ 28 per barrel. However, in the afternoon, quotes fell to $ 26.
“Today, the price of oil fluctuates around $ 27 per barrel of Brent. Such a price does not introduce significant growth drivers for the Russian currency, but at the same time it does not weaken strongly in tandem with the dollar and the euro, ”explained Artyom Deev, head of the AMarkets analytical department, in a conversation with RT.
Moreover, according to the assessment of Vyacheslav Abramov, director of the BCS Broker sales office, in the near future quotations may still recover to the level of $ 30-35 per barrel. According to the expert, in many respects the change in prices will depend on the actions of OPEC + countries and the pace of distribution of coronavirus in the world. Nevertheless, the expected recovery in China may play in favor of commodity prices.
“On April 8, quarantine in Wuhan is expected to be lifted, production will be launched, which may in the long term increase the demand for oil products,” Abramov added.
At the same time, the Russian currency is supported by improved sentiment in the global financial market. According to Abramov, global investors reacted positively to US authorities' measures to stimulate the economy in the context of the coronavirus. As a result, the mass panic on the stock exchanges stopped, players began to invest more actively in risky assets, and the demand for dollars decreased.
“The markets received a portion of positive news. Thus, the US Federal Reserve plans to print new dollars and buy securities on the stock market without restrictions, and the US authorities have agreed on a package of measures to stimulate the economy for $ 2 trillion. All this weakened the American currency in the world market, and, in particular, supported the ruble, ”Abramov explained.
Moreover, the depreciation of the national currency restrains the actions of the Bank of Russia. Recall, to stabilize the ruble since March 10, the Central Bank began proactive sale of foreign currency on the domestic market. Thus, the regulator artificially increases the demand for rubles.
Over the past two weeks, the Central Bank has increased daily foreign currency sales from 3.6 billion to 13.8 billion rubles. At the same time, the Central Bank acted in support of business in favor of the national currency and the financial system as a whole, said Artyom Deev.
“In particular, the regulator last week left the key rate at 6% per annum, and also provides the markets with ruble and foreign currency liquidity. It was decided to postpone tax penalties for air carriers and tour operators, expanded lending programs for small and medium-sized enterprises, and inspections of entrepreneurs were temporarily suspended, ”said Deev.
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- © Aleksey Ivanov / TV Zvezda
As TeleTrade chief analyst Mark Goikhman explained in a conversation with RT, amid a sharp weakening of the national currency in the past few weeks, many experts did not rule out the possibility of raising the key interest rate of the Central Bank following the March meeting. However, the Central Bank itself considered such a measure premature.
“An increase in the rate could be perceived by the market as the Central Bank’s insecurity in holding the situation after a sharp depreciation of the ruble. In addition, this would complicate the conditions for the business, making loans more expensive in a difficult situation. Therefore, a calm compromise decision by the Central Bank supported the Russian currency, ”explained Goikhman.
In general, RT analysts surveyed do not expect a significant weakening of the ruble in the short term. Moreover, experts consider it possible to strengthen the national currency in the second half of the year.
“In the absence of negative news, until the end of spring, oil prices can be expected near $ 30-35 per barrel, and the dollar and euro rates in the range of 75-78 rubles and 80-83 rubles, respectively. At the end of the year, if oil prices stabilize around $ 40 per barrel and the coronavirus pandemic is localized, the national currency can find an equilibrium point near 70 rubles per dollar and 78 rubles per euro, ”concluded Vyacheslav Abramov.