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USD/RUB Gaps Higher as Oil Markets Wither Under Demand Destruction Fears

RUSSIA
  • USD/RUB trades +1.43% higher this morning, driven by a 4% sell-off in oil markets and broad risk aversion across global markets.
  • Price action gapped higher at the open, moving above the July highs with an eye now on March-April levels in the 76-78 zone.
  • Fears of extensive demand destruction for oil markets on further lockdowns should keep RUB on the backfoot for now and markets will likely look to OPEC+ to backtrack its commitments for supply increases in December.
  • Threats of EU sanctions from Merkel regarding the Belarus situation are also of concern, but seem unlikely to materialise in the absence of a major escalation by Russia, given Germany's urgent gas supply situation.
  • USD/RUB should continue to trade in line with global risk and oil market developments today.
  • Intraday Sup1: 75.2853, Sup2: 75.0630, Res1: 75.9104, Res2: 76.3553
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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