The Russian currency showed its market face
Already in the first minutes of trading on the Moscow Exchange on Monday, June 26, the exchange rates of the main currencies against the ruble broke off the chain they were on over the weekend. The dollar exceeded 87 rubles — for the first time since the end of March last year, the euro broke through the mark of 94. And, although these jumps did not continue, this behavior of the «wooden» once again confirmed its chronic instability, inability to ignore external force majeure circumstances.
Since there are no auctions on Saturday and Sunday, the answer to the question — how the national currency reacted to the attempted rebellion — was postponed until Monday. The situation has only partly cleared up: after a sharp weakening, the ruble exchange rate strengthened just as quickly — up to 84.9 against the dollar and up to 92.6 against the euro. Against this background, the purchase price of American currency in the capital's exchange offices stabilized in the range from 83.7 to 92.1.
On Saturday, we recall that in a number of exchange offices cash dollars could be bought for only 100-105 rubles, euro — for 115-120. And on Sunday, many points that previously worked around the clock did not open like that: it was a solidarity step on the part of banks — in order to avoid a «raid» of customers and excessive demand for foreign currency.
Is it possible to call stabilization what is happening now? Rather, a short-term rollback. Yes, emotions subsided, the most pessimistic scenarios that could seriously change the business and political climate in the country did not materialize. However, fundamental macroeconomic factors remain, undermining the course, as constant hunger undermines the body.
First of all, this is a budget deficit of 3.4 trillion rubles, as well as a noticeable deterioration in the trade and balance of payments. According to the Central Bank, in January-May 2023, the current account surplus decreased by four times, amounting to $22.8 billion against $123.8 billion a year ago. In the situation with oil and gas budget revenues, there is not a hint of improvement in dynamics.
“On Monday, the ruble once again demonstrated its fearfulness, inability to take a hit,” said Igor Nikolaev, chief researcher at the Institute of Economics of the Russian Academy of Sciences. – All these endless exchange “swings” are proof of its instability and unreliability.
We see that in the face of increased risks and uncertainty, people tend to go into hard currency, first of all, into the so-called toxic one. Even despite the ultra-high purchase rates, this avoids the depreciation of savings. In general, the trend towards the weakening of the ruble continues, just the events of the end of last week played the role of a catalyst. When the ball rolls downhill, it is very easy to give it extra acceleration: just a slight push is enough. So it is with the ruble, which has been rolling down an inclined plane for a long time, although not at a steep angle.
According to preliminary data for the first half of the year, the dollar rose against the ruble by almost 20%, the euro — by 26%, and the yuan — by 19%. Given low oil prices and a large budget deficit, this trend will continue for a long time to come, says BitRiver financial analyst Vladislav Antonov. According to him, the mark of 86 rubles is an intermediate “resistance level” on the way to the 89-90 zone, so now the dollar has opened the road to 90, and the euro to 95-96 rubles. There are times when investors cannot control their emotions, being under the influence of geopolitical and macroeconomic events. Fear and panic have a bad effect on the national currency and stocks, and this is what happened right now.
“The ruble exchange rate is still determined by the balance of cash flows: we are talking about exports, which bring the currency into the country, and imports, which contribute to reduction of its physical volumes in the Russian Federation, — says financial analyst Sergei Ramaninov. — The events of the past weekend will not affect the ratio of export-import operations, but may well increase the outflow of capital abroad. They identified new risks in the economy (and in politics), in particular, the attractiveness of investments has clearly decreased.”
Meanwhile, the official exchange rate of the dollar, set for June 27 by the Central Bank, was 84.6, the euro — 92 .2 rubles. This is 58.5 and 80 kopecks higher compared to the previous exchange rates. The regulator has clearly recognized the trend towards the weakening of the national currency, but does not give in to panic.