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USD/RUB Breaks Below its 200dma, But US CPI Risks Remain High

RUSSIA
  • USD/RUB trades -0.35% lower this morning, bucking the trend in CEEMEA as price action finally pushes through the 200dma.
  • Oil markets trade slightly in the red this morning, having failed to hold onto gains above $75/bbl in yesterday’s session.
  • Outside of trade balance data (expected to fall slightly in Oct), the primary focus will be on US CPI data this afternoon.
  • Geopolitical risks have moderated this week following Putin-Biden talks, facilitating a partial unwind in embedded risk premia.
  • Moreover, support from market expectations for a hawkish CBR next week continues to keep RUB underpinned and among the few brightspots in the EMFX universe.
  • Market expectations have coalesced around a +75-100bp hike at next week’s meeting following hawkish CBR communications and an upside CPI print at 8.4% y/y.
  • However, early signs show there may be potential for a near-term peak in inflation with more favourable base effects entering the fray in December.
  • The 100dma at 72.8391 is the next focal point for the cross. Intraday Sup1: 73.1560, Sup2: 72.8416, Res1: 74.0639, Res2: 74.3325
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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