The ruble is likely to go down than to find the strength to grow
Start of a new week brought a new round of pressure on the Russian currency, which in the morning session on Tuesday allowed the dollar to highs in the area 65,60 RUB, a breakthrough which may lead to accelerated sales of the ruble. Given that the dollar strengthened on the Forex market, as investors are once again fleeing in defensive assets, such dynamics is quite natural.
Justified the weakening of the ruble in the context of global trends. A prolonged trade war that continues to worsen, reducing the chances of closing the deal between Beijing and Washington is not conducive to the expression of interest to purchase higher-yielding assets, including assets of the developing segment, which are together cheaper. Given the additional factor of pressure as the devaluation of the Argentine currency on the unexpected results of the preliminary presidential elections, opportunities for the strengthening of the ruble at this stage is limited, whereas the bearish risks remain and even intensify.
In the short term is to pay attention to the latest statistics on inflation in the United States, which set the tone for all dollar pairs. The restoration of the consumer price index in line with expectations or above expectations causing a surge of demand for the dollar as a reaction for reducing the risks of more aggressive easing from the fed. In this case, before the end of the day our currency risks to update the lows, and the risk of breakdown of the level 66 RUB will increase.
Academy of management Finance and investment