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Financial Conditions Continue To Tighten, Market Uncertainty To Weigh On CEEMEA Region

RUSSIA
  • Russian central Bank has resumed purchasing FX to keep the ruble from uncontrolled strengthening, Vedomosti reports, citing unidentified people, close to the Russian government and Bank of Russia (BBG).
  • Russian Finance Ministry and Bank of Russia have prepared proposals to reduce mandatory FX sales by exporters to 50% from 80% of their revenues (TASS).
  • Saudi Arabia recently mentioned that it will continue to ‘support’ Russia’s place in the OPEC+ group.
  • President Vladimir Putin meets Belarusian President Alexander Lukashenko in Sochi. Foreign Minister Sergei Lavrov meets students in Moscow region, according to Tass (BBG).
  • Many analysts are skeptical about the ‘Ruble recovery’ in the past few weeks as financial conditions are currently tighter than after the sanctions were imposed two months ago, which will lead to a dramatic recession in 2022 (some expect up to 30% YoY drop by end of 2022).
  • The chart below shows GS financial conditions for Russia, currently standing above the mid-March levels.

Source: Bloomberg

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