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Sell-Side Still Bullish RUB; OPEC & CPI In Focus This Week

RUSSIA
  • USD/RUB opens lower to test the 74.00 handle on firmer oil prices and broad-based risk-on across the EM space after a volatile week prior.
  • Brent rebounded strongly this morning, despite mixed APAC PMIs and expectations for an OPEC+ output increase this week (~1.5m bbls/day) - bolstered by the passing of the US stimulus bill.
  • Similar to ZAR, sell-side remains fairly optimistic about RUB's prospects once volatility in US real yields moderates - citing the commodity super cycle and that it remains undervalued at current levels.
  • OPEC & CPI will be the core focus of the week with this being the final month of inflation overshooting predicted before the start of a deceleration in price pressures keeping the CBR tilted to the hawkish side.
  • Markets will continue to watch USTs for more potential depreciation risks to EM FX in the near-term.
  • Sup1: 73.9016, Sup2: 73.6452, Res1: 74.1611, Res2: 74.5050
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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