After the spring strengthening of the ruble in the summer holiday season courses of the dollar and the Euro could rise at a moderate pace, experts say. In the next few months, investors will closely monitor the development of trade relations of the USA with China. The intensifying tariff war risks triggering a mass sell-off of emerging markets currencies. However, analysts still point out the attractiveness of ruble assets.
From the beginning of spring, the Russian currency was able to significantly strengthen against the dollar and the Euro by 1.8% and 3.6% respectively. However, as suggested by RT interviewed analysts, the summer dynamics of the ruble may be less clear and will largely depend on a number of geopolitical and seasonal factors. In particular, experts say the impact of the holiday period on the currency market of the country.
“Keep in mind that June — August is high season for tourism. The need to exchange currency for traveling abroad are able to moderately increase the rate of the dollar and the Euro against the ruble,” — said in an interview with RT the head of a group of analysts, OOO “CAPT” mark real.
At the same time, according to experts, in the coming months, the national currency will support continued high oil prices. As expected, critical to the raw materials ‘ quotes will be the meeting of the parties to the transaction OPEC+ 25-26 June in Vienna. As previously told RT the chief of analytical Department IK “Veles the Capital” Ivan Manaenko, members of the agreement may extend the contract on the reduction of hydrocarbon production. According to experts, this decision will help to keep oil prices at current levels — close to $68-70 per barrel.
At the same time a certain pressure on the ruble may have a strengthening trade war, the United States and China. About this in an interview with RT said a leading analyst QBF Oleg Bogdanov. As the expert explained, the tariff escalation between the two largest economies in the world runs the risk to turn into a massive sales of currencies of developing countries and increasing investments in the dollar.
We will remind, on may 10, the United States decided to exacerbate the conflict with China and increased tariffs on Chinese goods worth $200 billion, and has threatened to impose additional tariffs of nearly all remaining products from the Asian Republic, estimated at $300 billion, Beijing’s Response was immediate, and China announced the imposition of retaliatory duties of $60 billion from the 1st of June. Moreover, in the framework of strengthening trade war American technology companies have already begun to cease cooperation with the Chinese telecommunications giant Huawei.
“Confrontation between the US and China goes beyond the acute tariff war by enhancing mutual duties on imports. Now we see a new phase — opposition to large technology companies, as evidenced by the limitations of Huawei and possible retaliation against Beijing’s Apple. Investors are concerned that such a background may increase the deceleration of the world economy. This could reduce the demand for raw materials and currencies of emerging markets,” added mark real.
However, as explained in an interview with RT expert on the stock market “BCS” Igor Galaktionov, the ruble still remains attractive relative to other currencies of emerging countries, although increasing trade war can really affect the Russian financial sector.
From the beginning of may result in the aggravation of contradictions between Beijing and Washington is a key indicator of the stock markets of emerging economies — the MSCI Emerging Markets index fell nearly 8.7% and fell below the psychological mark of 1000 points. Index Mosberg, by contrast, has gained about 3% and several times updated the historical maximum. Today the figure is above the level of 2,600 points.
According to the assessment of Igor Galaktionov, the enthusiasm of some investors keep the risk of possible restrictive measures by the United States. However, in the current environment, players do not expect serious deterioration of the situation in the financial market of the Russian Federation. About this in an interview with RT said the head of operations on the Russian stock market IR “freedom Finance” George Vashchenko.
“The scenario of destabilizing the situation on the currency market in the near future not being seriously considered, and investors expect the Bank of Russia to reduce the key rate at a meeting in June. The actions of the regulator will reduce the appetite of residents to the OFZ, but not cause a wave of capital outflow,” — said Vashchenko.
According to the analyst, the reduction of the key rate of the Central Bank becomes possible due to the stabilization of the ruble in recent months and moderate inflation. As emphasized by mark Goikhman, the decision of the Bank of Russia will lead to cheaper loans and will be one of stimulus for economic growth.
Overall, as predicted RT interviewed analysts, during the summer the dollar will remain at the level of 63 to 67 rubles. Thus, according to the George Vashchenko, a trade war could weaken the European currency. Thus, the Euro will fluctuate in the range of 69 to 75 rubles.
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