The Russians have cooled to the dollar, for how long?
The demand for cash is markedly reduced, this is stated in the observations of the Bank of Russia. Statistics: in March of this year, the demand for cash dollars fell by 33%, and Euro by 6% in comparison with the levels in February. Aggregate demand yoy dipped by 19%.
The import of cash foreign currency also decreased by 24% in monthly comparison.
The decrease in the needs of Russians in cash at the end of the first quarter could be the result of seasonal factors: new year and other holidays are celebrated ahead of the big break without public holidays and, as a consequence, without the possibility to leave for a few days abroad on vacation. If so, that April data will show a surge in demand for cash dollars and euros before the may holidays. In anticipation of the summer historically, the demand for the currency increases, which is logical – holidays and vacations will require spending.
In addition, a decrease in the demand of the population for cash currency can be explained by the absence of over the last 14 months of pronounced economic and financial stress. People do not need the assets of “safe haven” where you can sit out troubled times. Observations show that the assessment of current economic situation among the active population is positive. In such circumstances, savings behavior, which the Russians usually is based on cash dollars rouble Bank deposits, changes in the consumer.
Most likely April and may data will show a growth of demand for cash currency within 5% -8%, the preponderance of forces is on the side of the American currency.