The ruble as Investors flee to safe assets
New worries about the deepening global trade wars today lead investors from the risks towards safe assets. The fact is that the US and China cannot agree on the schemes and the timing of the negotiations on a trade agreement. And if last week it is the obvious intention of China to resume dialogue on trade conditions interrupted the exchange, the flight from risk, but now the lack of unity returns of bidders in the sale.
For the ruble it is not the best signal, moreover, multiplied by the reduction in the cost of oil. A barrel of Brent today is clearly aimed to test the $58, and it all can happen. Internal factors supporting the “Russians” no.
But it could be for the ruble is much worse, given the behavior of the currencies of emerging economies, and under what tremendous pressure they are now. So the ruble in this situation, just lucky with a margin of safety.
What’s next? At the end of the week, the CBR will decide on the key rate and with high probability will be reduced. This possibility is already reflected in the falling habit, so if you don’t follow any alarming or ambiguous statements, the ruble will remain unchanged and will continue to respond to external background.
For the dollar in the short term, this means a corridor 66,50-67,15 RUB, nothing prevents “the American” punch up of 67.00. The Euro looks weaker overseas counterparts, the main trading today go about 73,26 RUB, in the next few sessions, the Euro/ruble will remain within the range of 73.00-73,65 RUB.
“Information-analytical center “Alpari”