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China Seen As Key Driver Of Oil Demand; Russia Exposed To Drop-offs

RUSSIA
  • Local & USD rates broadly flat this morning as choppy trading continues on volatile global sentiment.
  • Local 10Y yields continue to track laterally above 5.80 support, awaiting catalysts for decisive direction.
  • USD/RUB opens higher, moving back above 76.00 on broad based USD strength and weaker global risk sentiment - failing to breach the underside of the bear channel to close above 76.00 support and form a bullish hammer candle with yesterday's price action.
  • Mixed trading in oil markets on an uncertain demand and supply outlook is keeping futures pegged below the $45 handle. On the demand-side China is seen as the only major importer increasing demand this year, with futures and Russian revenues becoming more acutely vulnerable to drop-offs in demand from the APAC giant.
  • A daily close above 76.50 in USD/RUB may see the upper bound of the channel retested at around 77.00, while a move below 76.00 will need to clear 75.50 before moving back to 75 and below.

Local news

  • Russia starts converting ice rinks into makeshift Covid hospitals as case numbers continue to rise 23,610 today, 2m total) and mutations are registered in Siberia earlier in the week. Putin has noted the spike in infections is concerning, but says the situation is under control - Moscow Times
  • Retaliation bill, allowing sanctions against Internet platforms for censorship against Russian media will be submitted to the lower house of the Russian parliament today - RIA
  • Govt approves a roadmap for the 2021-2024 unrolling of 5G networks which Deputy PM Chernyshenko highlights as one of the priorities of digitalization of the economy, laying the ground for high-quality growth in many industries - Prime News Agency
  • Health issues for President Putin continue to require denials from the Kremlin as speculation over signs of sickness (coughing, trembling hands and possible Parkinson's) continue to spur rumours that Putin will step down at some point in 2021. International news agencies have dubbed his coughing as a fit, while state owned news said it was "absolutely normal" - Express
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com
MNI London Bureau | +44 020-3983-7894 | murray.nichol@marketnews.com

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