USD Bid In Early Dealing, Russia Sanctions Shake Markets

Matters surrounding the Russia-Ukraine situation continued to dominate headline flow over the weekend. Western nations removed certain Russian banks’ access to the SWIFT payments system over the weekend (although the trade of energy is set to continue, for now, avoiding the worst-case scenario on this front), while the Russian central bank was also subjected to sanctions as the west seeks to prevent the deployment of the country’s central bank reserves. We also saw Russian President Putin lift the alert level of the country’s nuclear deterrent forces to high, while the EU collectively moved to facilitate the armouring of Ukrainian forces in the ongoing conflict.

• Broad dollar demand has come to the fore in early Asia FX dealing. EUR/USD trades over 1 big figure lower (at ~$1.1150), although it is the Scandinavian currencies (NOK & SEK) that find themselves at the bottom of the G10 FX performance table. USD/JPY (+5 pips) & USD/CHF (+15 pips) have reversed their early move lower, with the wider USD bid pulling those crosses back from lows.
• Note that USD/RUB has traded around the RUB107 mark on EBS (per RTRS), after closing Friday trade just below RUB84.00.