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Why MNI
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.
RUSSIA
- The CBR decided to cut its policy rate more than expected in today's meeting, down to 8% (vs. 9% exp.), from 9.50% previously.
- The central bank also added that it will consider further cuts in the second half of 2022.
- Interestingly, EURRUB spot rateis barely unchanged following the decision, currently trading at around 58.90.
- We previously saw that investors have been questioning in the past few weeks if the Ruble ‘recovery’ was ‘real’ or just an ‘illusion’ as some analysts are expecting a sharp contraction for 2022.
- Today’s decision also confirmed that the current spot rate may not reflect the ‘fair’ rate given the current environment.
- Any other EM central bank cutting rates more than expected would have seen its exchange rate collapse, particularly considering the elevated level of risk aversion.
- Our MNI ‘fair’ value model is still pricing in an exchange rate closer to 100 than 60 (see chart).
Source: Bloomberg/MNI
Why MNI
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.
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