the course of the Russian national currency in June, is “quite strongly tied” to the news reports, and forecasts for the ruble “laid a higher degree of uncertainty than in may”. This opinion was expressed by the “Rosbalt” Deputy head of IAC “Alpari” Natalia Milchakova.
She notes that in the past month, “the ruble continued strengthening in April and rose by 3.8% against the US dollar and 2.6% against the Euro amid rising oil prices by more than 37%”. “In June, the strengthening of the ruble may increase, but may be suspended: news background promises to be a precarious and ambiguous”, — stated in the review of the expert.
first, she warns, “is scheduled for June OPEC meeting++ can bring completely unexpected results.” “The OPEC meeting and OPEC++ will take place before the end of the first decade of June. The meeting may be as a confirmation of the terms of the current deal (reducing oil production in June to 9.7 million barrels per day and the quota reduction on the reduction in July to 8 million barrels per day), and revise them. Moreover, a revision of the terms of the transaction may occur in any direction: as the preservation in July June production quotas to 9.7 million barrels per day, and in a more significant reduction of the quota to 7.7 million barrels per day. Such scenarios have already voiced Western and Russian media,” said Milchakova.
She believes that “preservation of existing conditions of the transaction or the tightening of quotas can cause additional growth in oil prices up to $40 per barrel, while easing the terms of a transaction may suspend the may rally on the oil market.”
second, the analyst continues, “the U.S. Federal reserve (the US Central Bank — ed.) on June 10 will announce its interest rate decision”. “With a high probability the fed will keep the interest rate corridor at the same level of 0-0,25%. This is negative news for the dollar, which may be a way topromote the strengthening of the currencies of developing countries, including the Russian ruble. However, if the presentation of the leadership of the fed would be more optimistic of expectations, the dollar may strengthen,” — said the expert.
third, she recalls, “on June 19, the decision on the interest rate will be announced by the Bank of Russia”. “We believe that at the June meeting of the Board of Directors on the key rate of the Central Bank of the Russian Federation will again be reduced, and a high probability that the Central Bank will reduce rate by 0.5 percentage points to 5%. Despite the fact that, by itself, lower interest rate implies depreciation of the national currency, the ruble often respond to lowering the interest rate of the CBR is the opposite way” — emphasizes Milchakova.
overall, it is estimated that “the movement of the ruble after the announcement, the Central Bank will depend on the nature of the comments of the regulator.” In addition, adds the analyst, “the foreign exchange market refers to the reduction of the key rate of the Central Bank as an important measure to support the real economy in crisis”.
“As you can see, the ruble exchange rate in June will be quite strongly tied to the news reports, which means that the forecasts for the June exchange rate of the ruble laid a higher degree of uncertainty than in may. We expect in June the dynamics of the dollar in rubles 69-74, without excluding short-term movements in the direction 68 rubles 75 rubles per dollar. At the exchange rate of the Euro expected values 76-81 rubles, although can not exclude short-term fluctuations in the Euro and in the direction 82 rubles, and in the direction of 75 rubles”, — the expert concludes.
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