Ruble: the Intervention of the Ministry of Finance will increase the pressure on the exchange rate

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The ruble continued to show low activity dynamics, trading in a tight range amid the absence of important drivers. Morning growth attempts failed due to the rebound of oil prices after the initial rise.
Locally, the Russian currency was again in oil, since no other benchmarks it is now not. In the commodity segment, there is increased volatility due to uncertainty ahead of the upcoming OPEC summit.
Players don’t decide on a stable and sustainable purchases, fearing that the cartel decides to increase production. On the other hand, from a more substantial drawdown of quotations restrains the overall fundamental picture in the world oil market. While the short term price fluctuations will continue to influence the behavior of the ruble.
Restricts downward pressure on the “Russian” dynamics of the dollar, which has recently shown signs of losing bullish momentum, giving rise to talk of peak in the direction of the uptrend. The attractiveness of the us currency undermined by recent signals from the ECB at the next meeting plans to set deadlines for the completion of the incentive program.
A negative factor for our currency will become the new record volumes of interventions of the Ministry of Finance, which is starting from tomorrow and until July 5 spent on purchase of foreign currency 379,7 billion. It is more than 40% more than in April. Such volumes are formed on the basis of budgetary rules, to change which the government is not going, despite high oil prices.
Given the combination of instability in prices of oil, the local weakness of the dollar and the beginning of June the intervention of the Ministry of Finance, the balance of risks for the ruble are still biased to the downside.
Roman Blinov,
The head of the analytical Department of the company,
“International financial center”