The growth rate of the ruble inhibits geopolitics

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Without signals from the oil market where trades today are not held on the occasion of good Friday and the start of the long Easter weekend in the Catholic world, reluctantly dropping the ruble against foreign currencies. In conditions of low liquidity due to the withdrawal of foreign players movements will be limited until the end of the day on Monday.
This week, the Russian currency will remain without a tax period, a one-on-one with geopolitics. On this front, the probability of further escalation of the diplomatic conflict. Yesterday in response to the actions of the West Moscow announced the decision to close the US Consulate in St. Petersburg and send 60 American diplomats from the country.
Not pleased with the prospect of imposing restrictions on operations with Russian Eurobonds on the London stock exchange, which spoke to the British Prime Minister may. While it is unknown what will come of this confrontation, but began to appear more and more signs that the “exchange of courtesies” at the diplomatic level ready to develop into something bigger and affect the debt market and the Russian economy.
In this context, risks for the ruble remain high. In the case of radical decisions to prevent a negative reaction of domestic assets neither rise in oil prices and potential weakening of the dollar. By the way, the U.S. currency lately, felt confident, despite the fact that four of the fed rate hike this year is not planned.
On the other hand, before you make aggressive decisions that will harm not only Russia but also the UK, may need to think about the consequences. In our view, likely to limit sales of Russian Eurobonds in London small due to the risks to international investors. In addition, since the settlement system, Euroclear and Clearsteam not within the jurisdiction of Britain, unilaterally, she’s not going to be able to introduce such a ban.
Roman Blinov,
Head of analytical Department,
“International financial center”