13 May 2015
Cautious tone prevails around RUB – Rabobank
FXStreet (Edinburgh) - Strategist at Rabobank Piotr Matys noted the cautious approach when comes to trade the Russian currency and assets.
Key Quotes
“The ruble surged 22% against the USD and gained 37% vs. the euro on the back of rebound in oil prices, a ceasefire in eastern Ukraine and demand for carry trade”.
“While Russia is likely to avoid the worst case scenario of severe and prolonged recession (we expect the economy to contract between 4-5% YoY this year), the RUB’s impressive rally is stretched compared to fundamentals”.
“Perhaps more importantly, we expect the CBR to continue to cut rates by at least 100bps per meeting to stem RUB gains in order to preserve competitiveness of exports – the only source of growth this year”.
“We continue to argue that betting on Russian assets remains a fairly risky strategy due to unsolved conflict in Ukraine”.
Key Quotes
“The ruble surged 22% against the USD and gained 37% vs. the euro on the back of rebound in oil prices, a ceasefire in eastern Ukraine and demand for carry trade”.
“While Russia is likely to avoid the worst case scenario of severe and prolonged recession (we expect the economy to contract between 4-5% YoY this year), the RUB’s impressive rally is stretched compared to fundamentals”.
“Perhaps more importantly, we expect the CBR to continue to cut rates by at least 100bps per meeting to stem RUB gains in order to preserve competitiveness of exports – the only source of growth this year”.
“We continue to argue that betting on Russian assets remains a fairly risky strategy due to unsolved conflict in Ukraine”.