Free Trial

ING Warns RUB Offshore/Onshore Market Bifurcation May Persist

  • The introduction of sanctions against many Russian banks has seen bifurcation emerge in the rouble FX spot market, where the rouble yesterday was briefly trading 10-15% weaker in the offshore than the onshore market. ING expect this two-tier market to continue and European currencies to remain under pressure
  • The counter-party limitations and risks posed by aggressive sanctions against Russian institutions have seen the emergence of a two-tier rouble market.
  • Onshore names will trade with onshore names and offshore with offshore. Last night the onshore USD/RUB rate closed around 101 at a time that the offshore rate was being quoted at 115.
  • It is hard to see that gap being closed anytime soon, although there is a chance that the offshore USD/RUB is dragged a little lower as Russian exporters are forced to sell their accumulated FX earnings over coming days - these flows may go through the onshore market as ING understand it.
MNI London Bureau | +44 020-3983-7894 |
MNI London Bureau | +44 020-3983-7894 |

To read the full story



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.