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USD/RUB Breaches 70 Support as the Greenback Slides Pre-FOMC

RUSSIA
  • USD/RUB BGN trades -0.33% lower this morning, having trimmed some of yesterday’s run lower into the close.
  • Falling UST yields and a softer greenback pre-FOMC fuelled the break through 70 support to reach an intraday low at 66.43, with the cross brushing off the larger than expected 300bp CBR rate cut last week.
  • Today’s focus will be on USD-side drivers ahead of the FOMC meeting with markets eyeing dialogue surrounding balance sheet run-off (expected June) and scope for a +75bp hike in the coming months with +105bp priced into rates futures by July.
  • The EU oil embargo is also expected to be announced today, which should weigh more heavily on the pending Russian recession in 2022 & 2023 as Russian oil in phased out at the end of the year.
  • With no negotiations on the horizon, the conflict is set to continue with defence experts eyeing 9 May for Putin’s next military steps. 65.00 & 63.00 represent the next key downside levels on a break below yesterday’s lows at 66.43.
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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