Members login
Forex - Russian Federation FX Flows - RUB stabilises against the basket ahead of long weekend
Written by article default Wednesday, 03 November 2010 12:41
Following volatile start to the week the ruble has stabilised against the basket at around 36.35. We do not expect major moves as market players are reluctant to get involved ahead of the Fed and long weekend in Russia. In our view the worst could be behind the ruble and that in November we should witness RUB's recovery against the basket as Fed's easing measures should lead to softer USD and stronger commodities which would offer the ruble support. Our short-term target is set at 35.500. At this stage the ruble is mainly supported by the CBR buying around USD300-400mn every day, but demand for the ruble may soon increase amongst market players as well. On the negative side, demand for the hard currency may prevail with business daily Vedomosti reports that Russian fertiliser company Phosagro plans to buy Canada's Potash Corp worth around $39bn which implies that demand for hard currency may prevail.