The rouble received support, but it won’t last
The Russian currency is enjoying demand following the increase in Russia’s rating to Baa3 from Moody’s. Now the rating of Russia to investment grade from all three major agencies. This extends the attractiveness of Russian securities for international funds.
In addition, markets are also “work out” comments the Agency. It is important to understand that Moody’s initially were reluctant to increase the rating, wanting to monitor the market’s reaction to the sanctions, and then due to a collapse of oil. However, it appeared that Russia’s financial system has demonstrated a comparative resistance to economic risks.
A clear, though simplified, can be considered a manifestation of the dynamics of the ruble. He seriously lost in 2018, however, the main drivers of the reduction of currency sanctions in April, August and September, while negative news like the collapse of quotations at the end of the year and volatility in emerging markets, though, and hurt the ruble, but quickly pulled back down.
For the future this means the Russian currency to ignore the oil and even feel better colleagues from developing countries, when it comes to turbulence in the financial system. At the same time, the growing importance of the reaction of the ruble to the sanctions. As a new round of promises to affect the entire national financial mechanism, the markets expected a very nervous situation.
Most in this case is alarming is the subject of sanctions against Russia, which again began to appear in the speeches of U.S. lawmakers. It makes a more cautious view on the prospects of the ruble.
You should pay attention to the levels close to 74 per Euro, from which the pair earlier last year a few times unfolded to growth. It is possible that an important support level for EURRUB and warlike rhetoric, the United States will be superimposed on each other, which will increase the reversal of the ruble to decline. For the dollar to such an important level is at 65: from her USDRUB repeatedly bounce from October last year.
Simply put, the ruble still has some potential to strengthen, however you should be careful with the purchase of the Russian currency from current levels, as risks are becoming more tangible.