The dollar is heading towards 90 rubles

Participants in currency exchange trading tested the level of 90 rubles / $, but the excess of the round mark was more likely a signal for fixing speculative profits. The weakness of the Russian currency is still determined by the reduction of the foreign trade surplus. The Central Bank is outwardly calm about the fall of the ruble. But market participants admit that it will give a reason to raise the key rate.

The attempt of the dollar exchange rate to gain a foothold above the level of 90 rubles/$ at the auctions of the Moscow Exchange on July 4 was not successful. In the middle of the trading day, the US currency exchange rate reached 90.2 rubles / $, the maximum since March 28, 2022. However, overcoming the round mark served as a signal for profit taking, and already two hours later the rate rolled back to 88.6 rubles/$.

Trades closed at 89.19 rubles/$, which is 50 kopecks. higher than the previous day’s close.

The euro exchange rate also briefly rose above 98.28 rubles / €, the maximum since March 29, 2022, and rolled back to 97.24 rubles / €, by 60 kopecks. above the July 3 close. The Chinese currency rose to a maximum since April 19, 2022 – 12.47 rubles / CNY, and closed at 12.33 rubles / CNY.

However, there was no excitement at the auction, the volume of transactions with delivery “tomorrow” generally corresponded to the average values ​​- a little more than 100 billion rubles. on the dollar, 125 billion rubles. yuan and less than 50 billion rubles. by euro.

In general, market participants attribute the weakening of the ruble to the reduction of the foreign trade surplus. According to the Bank of Russia, the monthly trade balance this year was $8-13 billion, while last year it was $18.5-32 billion.

According to the chief analyst of Sovcombank Mikhail Vasilyev, Russian export earnings are declining due to the weakness of commodity prices in world markets, as well as due to Western sanctions. The country as a whole is receiving less currency from exports this year as companies leave it abroad.

According to the head of the analytical department of Bank Zenit Vladimir Evstifeev, the reduction in the balance of payments surplus against the background of the outflow of private foreign capital and the continued growth of imports causes an increased demand for foreign currency within the Russian Federation.

The stabilization of oil prices provides some support to the Russian foreign exchange market, even taking into account the fact that they are close to the minimum values ​​since the end of 2021. According to Investing.com, Brent quotes have been in the range of $74-77 per barrel since the end of April.

In addition, according to the Ministry of Finance, in June discount Urals oil to Brent was less than $20 per barrel. Quotations of Russian oil when sold to India will be pegged to the Dubai variety with an even smaller discount, Reuters noted. Mikhail Vasiliev believes that in July Brent will trade in the range of $70-80 per barrel, but at the same time, “the risks are rather shifted towards lower quotes.”

Nevertheless, market participants expect more stabilization in the near future. PSB Chief Analyst Denis Popov admits that the dollar will return to the range of 86-88 rubles/$.

According to him, with further weakening of the ruble, imports of goods and services will be under pressure and will decrease due to cooling demand. According to Mikhail Vasiliev, the rapid depreciation of the ruble is unprofitable for the Bank of Russia and the government, as it increases devaluation and inflation expectations, importers’ costs, and increases risks to financial stability.

So far, the Central Bank is not very worried about the current situation. As Ksenia Yudaeva, First Deputy Chairman of the Bank of Russia, stated on July 4 at a meeting with journalists, “there is no need to talk about any risks of financial stability, additional to what was all the previous time.” At the same time, the Central Bank is not going to return the rule on the mandatory sale of foreign exchange earnings by exporters, she assured.

Vladimir Evstifeev believes that, taking into account the lack of concern of the financial authorities regarding the current position of the ruble, “it is hardly worth counting even on verbal interventions in support of the national currency” at a dollar exchange rate above 90 rubles / $.

Nevertheless, according to Mikhail Vasiliev, the current weakening of the ruble increases the likelihood that the Bank of Russia at the next meeting of the board of directors on July 21 will raise the key rate by 50 basis points at once, to 8% per annum.

Dmitry Mikhailovich