Back
4 Feb 2015
Attempts of recovery in RUB still remain elusive – Rabobank
FXStreet (Edinburgh) - Following the recent CBR moves and the highly unpredictable scenario in Russia, strategists at Rabobank see unlikely a reversion of the RUB weakness in the near term.
Key Quotes
“After raising the key interest rate by 650bps to 17.00% on December 15 to stabilise the ruble and prevent a full-blown financial crisis, the Bank of Russia unexpectedly cut rates by 200bps at the first meeting this year on January 30”.
“The fact that the CBR’s surprising decision coincided with a rebound in oil prices to some extent offset the negative impact of lower interest rates”.
“Still, the 200bps cut could still prove costly if oil prices resume a downside trend and the conflict in eastern Ukraine escalates”.
“Additional pressure on the RUB could come from a ratings downgrade to junk by Fitch and/or Moody’s which could follow S&Ps”.
“We maintain a cautious approach as it is too early to expect sustainable RUB recovery just yet”.
Key Quotes
“After raising the key interest rate by 650bps to 17.00% on December 15 to stabilise the ruble and prevent a full-blown financial crisis, the Bank of Russia unexpectedly cut rates by 200bps at the first meeting this year on January 30”.
“The fact that the CBR’s surprising decision coincided with a rebound in oil prices to some extent offset the negative impact of lower interest rates”.
“Still, the 200bps cut could still prove costly if oil prices resume a downside trend and the conflict in eastern Ukraine escalates”.
“Additional pressure on the RUB could come from a ratings downgrade to junk by Fitch and/or Moody’s which could follow S&Ps”.
“We maintain a cautious approach as it is too early to expect sustainable RUB recovery just yet”.