The ruble will depend on oil prices and geopolitics
USA without achieving understanding with its partners on sanctions against Iran, decided to relieve pressure on the rogue state. The form in which this will occur is unclear. But the market was quick to win back the news and corrected the oil by 3.6% to $83,25 per barrel from the open today morning. At the same time, started a new cycle of the strengthening dollar in the Asian trade has risen by a quarter percent on the DXY index to 95,50. In this regard, the newly depressed most of the “hard assets” – from metals to cellhasfocus.
Otherwise, today we expect a quiet day as the holiday day in the USA, Columbus Day, indicates a slowing of trade and macro economic activity.
But the main newsmaker today is not a ruble, not even oil, and Indian rupee. According to the “strange” coincidence as only between Moscow and other country trust established diplomatic relations, so immediately the currency of this country is exposed to speculative attacks. According to “Kommersant”, the Chief of staff of Indian army General Bipin Rawat on the threat of sanctions from the United States after the signing of the contract for the purchase of Russian anti-aircraft missile systems s-400, said that “India is pursuing an independent policy, even knowing that the country could be sanctioned”. He added that in the future India would like to buy Russian helicopters Kamov and other weapons.
Actually, there probably really is the place to be a purely pragmatic approach: the us dollar had risen against most currencies, American products – especially such as technologically advanced defense products – just-for-just lost all the competitiveness of third countries, so for them the question is squarely: either alternative purchase, or the degradation of the armed forces. We also recall that on Thursday last week began a joint summit between President Putin and Prime Minister Narendra modi.
But back to today’s turmoil in global currency markets. In the first half of the day, the rupee fell another 32 PKT up to 74,08 dollar for dollar, and for the week between October 2nd and have already lost 1.4 percent, and the process, apparently, is gaining momentum. On Friday, the rupee lost 18 PCT to a record low 73,76 after falling to a historic low in 74,23 (intraday value). Over the past four trading sessions, foreign investors have taken from the Indian capital markets over 93,00 billion rupees ($1.3 billion).
In addition, tightly controlled NBK Chinese onshore yuan fell today from 6.87 to 6.92 per dollar. Offshore yuan also weakens – though slightly less noticeable. The people’s Bank of China said on Sunday that since October 15, it reduced the reserve requirement for banks ‘ reserve requirement ratio (RRR) by 1 percentage point on the background of a deepening trade war with the United States.
Ruble with open feel better with 66,56 to 67.00 dollar and 76,72 76,92 to the Euro, but later corrected to 76.83 against the Euro, which once again proves that the roots of the problem are paired with the dollar. The future prospects of the Russian currency will depend on the dynamics of oil prices, which, in turn, is waiting for clarification regarding the change of position of official Washington against Tehran.
“International financial center”