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29 Jan 2016
RUB: it’s all about oil – Rabobank
FXStreet (Edinburgh) - Piotr Matys, Strategist at Rabobank, sees crude oil prices as the main driver= behind the pair’s performance.
Key Quotes
“For the Russian ruble it is all about oil. While our baseline scenario assumes that Brent crude should finally stabilize at around USD 30 per barrel in Q1 (before gradually recovering and end this year at USD 50 per barrel), in the near-term prices could still fall into USD 20s”.
“Consequently, USD/RUB may extend its gains to high 80s/low 90s in the coming weeks/months before trimming its gains in the second half of the year when Brent crude edges higher”.
“With the Central Bank of Russia unable to resume its easing cycle perhaps until 2H, the West still reluctant to ease its sanctions and oil prices likely to remain lower for longer, the prospects for Russia are fairly bleak. We expect the economy to contract by 0.7% y/y this year”.
Key Quotes
“For the Russian ruble it is all about oil. While our baseline scenario assumes that Brent crude should finally stabilize at around USD 30 per barrel in Q1 (before gradually recovering and end this year at USD 50 per barrel), in the near-term prices could still fall into USD 20s”.
“Consequently, USD/RUB may extend its gains to high 80s/low 90s in the coming weeks/months before trimming its gains in the second half of the year when Brent crude edges higher”.
“With the Central Bank of Russia unable to resume its easing cycle perhaps until 2H, the West still reluctant to ease its sanctions and oil prices likely to remain lower for longer, the prospects for Russia are fairly bleak. We expect the economy to contract by 0.7% y/y this year”.