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RUB Resilient, While Possible OPEC+ Output Hikes Loom

RUSSIA
  • USD/RUB opens lower after peaking at 74.8466 in yesterday's session as risk-off hit EM FX.
  • Oil slipped overnight as the Greenback caught a bid and may face some headwinds ahead of next week's OPEC+ meeting where some supply is expected to come back onto the market as lofty supercycle estimations of $100/bbl oil, prompt concerns of overly-tight output levels.
  • However, ~4m bbls/day of output are currently offline due to the Texas deep freeze and will likely remain that way until 05 March.
  • USD/RUB has been relatively more resilient than high-beta peers ZAR & TRY due to strong oil-side factors & cheaper valuations at current levels.
  • This should play in its favour in prevailing volatility, but expectations oil output hikes may temper RUB strength on the margins.
  • EU sanctions threats are mostly priced in at this point, and US sanctions are seemingly 2-3 weeks away.
  • Intraday Sup1: 74.1611, Sup2: 73.9016, Res1: 74.5050, Res2: 74.8365
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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