The ruble depreciates after oil, pushing back some of the losses from the southern kurtosis
MOSCOW, March 16 (Reuters) – The ruble is lower on Thursday evening given oil prices have fallen significantly in recent days, but is relatively far from the multi-month lows that were unexpectedly and sharply reached today and just as quickly recovered to a large extent measure back.
At 17.45 Moscow time, the dollar / ruble pair was close to 76.75, the ruble is losing 1%.
The euro/ruble pair was trading at 17.45 Moscow time at 81.12 and the ruble is weakening by 1.1%.
Combined with the yuan, it loses 0.8% to 11.09.
In the afternoon, directly below the Moscow currency fixing calculated at 12.30pm, the russian currency hit its worst since April last year, 77.49 to the dollar, 82.62 to the euro and 11.21 to the yuan, with exchange volumes soaring, but then it rolled back, and pressure on the ruble in the evening rose again.
The volume of transactions in the dollar/ruble pair with settlements “tomorrow” for the period from 12:00 to 13:00 amounted to almost USD 650 million, and from 7 am to date it barely exceeded USD 1.6 billion.
According to the dealer of a large Russian bank, such a jump looks primarily like a conscious, short-term game with the ruble in order to fix the exchange rate of some large market participant in order to later sell the currency to the bank’s client at an overvalued ruble interest rate, and this may take place in the current low liquidity of the market.
“We believe that the reasons for the collapse of the ruble are purely local. USD/RUB futures, for which the spot rate fixing is used for trades in the period 12.25-12.30 Moscow time, expire today. At that moment, the demand for foreign currency rose sharply, which caused the ruble to collapse, ”Dmitry Polevoy from LokoInvest shares a similar opinion.
In his opinion, it could be some kind of psychological or technical delay in deciding to execute trades related to the fix, but it could also be trivial market manipulation, “so at least CBR has a basis for auditing.”
Crude oil, which has been declining in recent days, remains the key factor behind the pressure on the ruble, and the main, albeit minor, local support is the sale of the Chinese currency by the Central Bank as part of the budget rule in the equivalent of USD 71 million at the current exchange rate.
A barrel of Brent on the eve dropped to $71.67 for the first time since December 2021 and is now down 2% to an estimated $72.20.
OPEC+ believes this week’s fall in oil prices is due to financial problems, not an imbalance between supply and demand, and expects the market to stabilize.
Brent has lost almost 13% since the beginning of the week on concerns about demand should the global economy slip into a crisis that could result from the current volatility in the banking sector.
Russia’s Urals export, supplied to Europe’s north-west region, is now trading at $45.65 a barrel and could end Thursday at its lowest level since early January
Today, additional pressure on the oil market was exerted by the ECB’s decision to raise the euro by 50 basis points, which tightens credit criteria in the euro area and threatens economic growth, and with it fuel consumption.
At the same time, panic in global markets eased somewhat on Thursday after it emerged that Credit Suisse would borrow up to $54 billion from the Swiss central bank to maintain liquidity and investor confidence.
Credit Suisse has become the first major global bank to receive bailout since the 2008 financial crisis.