Policy governs the stock market of Russia
Russia was the victim of political games the American elite as a result of pre-election struggle between Democrats and Republicans for the most number of seats in the U.S. Congress. Elections will be held on November 6, 2018, and Democrats want to take revenge for the defeat in 2016. So in July before the summer break of congressmen in the Congress was introduced 5 bills causing substantial economic damage to Russia. In turn, the state Department went ahead of the senators in the topic of sanctions to try to soften their attacks on the President of the United States, which is the Republicans.
Thus, the state Department imposes new sanctions against Russia on August 22, and after 90 days will introduce a second tranche of sanctions. The law is binding, but some of his points, the US President has the right to cancel. Thus, in a political context it is about the struggle to preserve their places by Republicans, and as President of the United States.
As you get closer to re-election in Congress tension degree will increase. Based on the foregoing, we believe that the second tranche of sanctions will be introduced with all its consequences. But those American companies that give money to war Democrats and Republicans recommend not to impose sanctions against the Russian banking system. Because it will cause economic damage to the American holders of Russian local debt, private lenders, investors of a different rank.
If congressmen or the state Department will not stop, there will be lawsuits to the U.S. government demanding compensation for economic damages. Therefore, investors ‘ attention will focus on the development of the current situation. The Russian market will continue to be in a state of storm, and the ruble will continue weakening against the dollar that will provoke people to buy more currency.
It is possible that the situation Dec 2014 again, when the Central Bank sharply raised its key interest rate to immobilize the market. In this population will empty out the ATM, take money from accounts to invest in real estate or purchase currency, or any equipment, then you will have to sell at a huge discount. Plus the monetary policy of the fed will encourage investment dollars in hard currency.