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RUB Dials in on OPEC+ JMMC as Output Hike Speculation Whirls

RUSSIA
  • USD/RUB opens lower on the back of a softer dollar and higher oil futures, following on from a solid session of US sanctions-related RUB gains.
  • Oil markets dial in on the OPEC meetings today and tomorrow for signs of increased output. Markets have mostly priced in a 1.5m bbl/day hike
  • but a leaked JTC document called for cautious optimism, citing "uncertainties underlying physical markets and macro sentiment" that may see this number diminish.
  • API inventories also showed a substantial build at +7.4m bbls vs -0.928m exp, weighing on futures.
  • USD/RUB has broken the short-term uptrend established on 12 Feb, but will still need to negotiate rising US real yields to realise some of its undervaluation.
  • Overcoming the Navalny sanctions hurdle is a significant pro, but SolarWinds hacking measures from the US are still in the pipeline and are a concern if they're extensive in scope – which Biden hinted they might be.
  • However, as we've seen at these levels – non-material sanctions create temporary uncertainty in the lead-up, followed by a re-establishment of positive RUB sentiment.
  • Intraday sup1: 73.4212, Sup2: 73.1217, Res1: 73.6452, Res2: 73.9016
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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