The ruble is in danger of collapse at the beginning of 2019 because of oil and geopolitics
The main two risks for the ruble at the current festive for global markets the week – oil and geopolitics. The macroeconomic calendar is empty, but has risks from now on not be updated as regularly as before, until the day of the resolution adoption of the new budget in the United States (AKA “government shutdown”), which, as is well known, the role of the stone on which I found spit, performs Mexican wall Donald trump. To this story over the weekend have added on “well forgotten old” the crisis of the personnel policy of the US President, suddenly fired the current head of the Pentagon Jim Mattis.
Over the weekend Treasury Secretary Steven Mnuchin gathered for an emergency meeting the top leadership of the six largest US banks and even, in accordance with the new tradition of Washington shared about this event in his Twitter. This happened after big losses in the stock market last week and the aforementioned partial suspension of the Federal government, which apparently believes American higher official, may be involved in a serious deterioration in investor sentiment.
Most interesting is that the bad mood of the us markets though potentially makes Russian stocks with their higher dividend more interesting, but in practice this is not felt. Thus, according to well-known aggregator of relevant information EPFR, three weeks from the beginning of December the outflow of global investors focused on Russia’s investment funds, was $330 million.
The total for the year was derived from the Russian market more than $1 billion – the maximum amount of with 2013. However, to blame only one our notorious poor investment climate, or even a sharp drop in oil prices is not quite correct, because the root of all evil – still tightening monetary policy in the United States, draining cash liquidity on all global markets.
The flow of investment (about $500 million) Russian funds recorded only in January of this year. The first wave of outflow was recorded in the spring after the April introduction of US sanctions, when it was withdrawn about $690 million
As of 13:00 Moscow time, the ruble unprincipled, barely noticeable strengthening the dollar and reacting with the opening of only 3 cents to 68,39. The situation in tandem with the Euro looks as boring: the ruble was almost unchanged from the open and traded to a “European” level just below 78. Technically, this level is nothing, and its breakout in either direction is unlikely to lead to the formation of a new trend. Much more dangerous for the ruble geopolitical provocations that may occur, “according to old tradition” Christmas in exactly a week, so better to protect yourself from unpleasant, difficult to predict events.
For this purpose it is not necessary to expose yourself to the dollar risk, which in turn focused in the further actions of the fed and the scenarios mentioned above, the “government shutdown”. Tools such as the gold background looks nice and has the best prospects in the probable stress conditions: today, the precious metal rose to $1265,35 per ounce compared to $1263,35 per Troy ounce as of the same time of the day on Friday.
“International Financial Center”