The ruble lost a fragile gain in the evening, OFZ from the auction is getting a little cheaper

MOSCOW, Jan 24 (Reuters) – The ruble lost modest intraday gains on Tuesday evening amid still-short selling of export earnings, while market participants continued to wait for an increase in currency supply to offset taxes. And for this profit there is a ruble for a long time, closing them, dysfunctional, under the session curtain.

At the same time, the volume of intervention by the Central Bank without export support is not sufficient to significantly strengthen the ruble, moreover, the regulator is gradually reducing its presence in the local foreign exchange market every night.

At the same time, the factor of reduction in the flow of foreign exchange earnings to the country continues to play against the ruble, also taking into account the Western price cap for Russian oil and the coming sanctions on petroleum products from the Russian Federation. Due to the still significant current Ural discount to Brent.

As of 17.50 Moscow time, the exchange quotes of the dollar / ruble pair with the calculation “yesterday” were close to 68.93, and the ruble shows almost zero dynamics, but growing in price up to 68.66 intraday.

The euro/ruble pair is now quoted at 74.91, and here the ruble is losing a quarter of a percent, having previously risen in price to 74.55.

Paired with the Chinese currency, the ruble is quoted near the last close of 10.13, rising in price to 10.09 intraday.

Due to the New Year holidays in China, all settlement on exchange transactions with the yuan from January 20 to January 27 will be carried out next week due to the current New Year holidays in China.

From last Friday until February 6, the Russian Central Bank has been selling Chinese yuan from reserves with “yesterday” settlements under the budget rule, amounting to 3.2 billion rubles (about $47 million equivalent) per day, and due to holidays in China, The volume of these works is January 20 to 27, also in the next week, the cumulative total will be reflected.

From Russian exporters, participants of the local foreign exchange market are waiting for an increase in the sale of foreign currency for rubles for the upcoming tax payments, while from the beginning of 2023, commodity corporations and other taxpayers are expected to pay the budget with a single tax payment. Have been ( this month – January 30).

According to analysts of Bank St.Petersburg, in the short term, the dollar/ruble pair has the potential to fall to 68.50 against the background of the sale of foreign currency earnings by exporters within the current tax period.

Oil prices remained slightly below multi-week highs on Tuesday: in the evening, Brent was priced at $88.13, having reached $89.09 a day earlier for the first time since December 1.

Spot quotations of Russian Ural reference oil blend for delivery to northwestern regions of Europe now $55.55 per barrel for delivery to Mediterranean ports – approx $60.57 ,

In the ruble government debt market, most newspapers show a slight negative trend in the evening before tomorrow’s Ministry of Finance auction. Yields on most stocks have increased by 1-4 basis points.

On Wednesday, there will be two unlimited placements of Classic OFZ, while a new paper, Series PD-26242, will also be introduced on 29 August 2029.

“An excess of proposals from the Ministry of Finance may put pressure on OFZ quotes, which, inter alia, make borrowing less profitable for the department. However, their current plan, most likely, already takes into account the yields ,” Raiffeisenbank said in a review.

In the first quarter of 2023, the Russian Ministry of Finance plans to raise 800 billion rubles on the ruble-denominated public debt market, and over two January auction days, the plan was completed by 18.4%.

On Wednesday, the Ministry of Finance will redeem the issue of PD-26211 for 150 billion rubles, and due to the possible refinancing of part of this volume, SberCIB analysts expect an increase in demand at tomorrow’s auction. (Moscow Bureau)

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