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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
RUSSIA
- Russia FinMin Siluanov mentioned at a business event that the government was open to further easing of capital controls and may use energy excess revenue for FX interventions.
- Siluanov added that the government will discuss Ruble impact on exporters next week and may let exporters take FX payments in cash.
- Interestingly, Russian officials have talked about the Ruble strength on several occasions in recent weeks, pushing the central bank to take measures to weaken it to improve the country's competitiveness.
- Economy minister Reshetnikov mentioned today that continued RUB strength may hit industry output.
- According to BBG quote, RUB is the 'strongest' currency in the world this year, up 45% against the USD (see chart below) and trading close to a 7-year high against the Euro.
- However, we have questioned in recent weeks the ‘Ruble recovery’ given the current macro outlook with some Russia officials underestimating the economic impact of the war for 2022 (officials estimate a ‘mild’ 3% contraction while some analysts expect a 10% contraction in GDP this year).
- For instance, MNI ‘fair’ value of EURRUB prices in an exchange rate closer to 95 (using a set of macro and financial variables); the chart shows the strong divergence between the ‘spot’ rate and the ‘fair’ value rate since the beginning of April.
Source: Bloomberg/MNI
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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