Dollar exchange rate. Forecast for December 4–8

Vladimir Evstifeev,
head of analytical department

the ruble is more sensitive to medium-term fluctuations in the cost of a barrel

The ruble is losing its advantages amid the end of the tax period and falling oil prices. Investors considered the decisions at the OPEC+ meeting insufficient to maintain a deficit in the oil market, which would allow prices to remain at elevated levels. In conditions of increased dependence of the Russian budget on the level of oil prices, the ruble is more sensitive to medium-term fluctuations in the cost of a barrel, so the Russian currency may remain under moderate pressure in the coming days.

Market participants will remain cool

Until the end of next week, we predict a trading range at the rate in the range of 90.0–91.5 rubles/$. As we predicted, we are seeing a gradual return of the dollar exchange rate to the range of 90–100 rubles/$. Note that the gradual growth of the dollar index on world markets is facilitated by expectations of an additional rate increase by the American regulator, which may take place on December 13. This will be the final week before central bank meetings, so market participants will remain cool, which will be reflected in lower trading volumes. Among the important events before the end of the year, which can also significantly affect the exchange rate of the national currency, is the meeting of the Bank of Russia on the key rate, which will take place on December 15. Some market participants continue to increase their positions in ruble debt, which has a positive impact on the ruble exchange rate.

Maxim Timoshenko,
Director of the Financial Markets Operations Department

Discussion of the risks of increased inflation in the United States

The ruble has stabilized in the range of 88–89 rubles/$. waiting for signals to move on. The latest news about the resumption of foreign exchange interventions by the Bank of Russia in January 2024 has not yet led to market consensus regarding their impact on the national currency exchange rate. Market participants are also focusing on an active discussion of the risks of increased inflation in the United States against the backdrop of prospects for rising energy prices. The Fed continues to maintain hawkish rhetoric and hints at a possible tightening of monetary policy. Temporary interruptions in oil supplies due to a storm in the Black Sea contributed to a slight increase in oil prices. The currency and energy markets are kept in suspense by the prospect of another postponement of the OPEC+ meeting on the level of oil production in the coming year against the backdrop of disagreements. The euro-dollar pair is not in favor of the relatively low economic indicators of the eurozone, which remains a risk factor for these currencies.

The pullback of oil prices and the current dynamics of currency pairs are local in nature

The ruble weakened significantly at the end of the week: demand for foreign currency increased noticeably against the background of the lack of improvement in the situation on the oil market and the restoration of the dollar’s ​​position on world markets. In my opinion, the pullback in oil prices and the current dynamics of currency pairs are local in nature. I admit that in the coming days the ruble will remain under pressure from an unfavorable external background. But in the future I expect the exchange rate to return to the range of 85–90 rubles/$. The ruble will be supported in December, along with strict foreign exchange controls, by high rates that can restrain demand from imports and increase interest in ruble assets, as well as expectations of an additional increase in the key rate on December 15.

Denis Buivolov,
analyst

Strong movements in the exchange rate both up and down are unlikely in the short term

Our forecast for the ruble to dollar exchange rate for next week is 88.5–91.5. The balance of factors has developed in such a way that strong movements in the exchange rate, both up and down, are unlikely in the short term. By Friday, the Russian currency had lost a number of positions, which, however, was predictable against the backdrop of the end of the tax period and the impulse to strengthen the dollar itself on the global foreign exchange market. Meanwhile, the oil market is digesting the decision made by OPEC+ on quotas and cuts. It is quite possible that after a reassessment of the alliance’s actions and intentions, as well as under the influence of the escalation of the Middle East conflict, oil prices will shift closer to $85 per barrel of Brent. This would support the ruble, along with the effect of a strict monetary policy and mandatory sales on the domestic market of most of the export proceeds.