RUB: can’t resist oil
OREANDA-NEWS. Yesterday, risk sentiment on the Russian FX market was spoiled by a dive in oil prices as well as MinFin’s statements on FX purchase for external redemption financing. Later, in its commentaries to RIA news agency, the CBR clarified that MinFin was buying FX not through the open market, but directly from the CBR. In the afternoon, the oil factor began to play a major role, outweighing export selling flows. As a result, RUB corrected down 0.9% to 49.55 against USD, while the Brent price dipped 3.7% to USD 63.2/bbl. In the meantime, trading activity visibly accelerated, with MICEX turnover picking up to USD 4.6bn yesterday.
The EM FX universe remained in the red: the EM FX index nudged down a further 0.5%. BRL underperformed, losing 1.1%, followed by TRY and ILS, which slipped 0.5-0.6%. Commodity-based currencies continued to trade heavy too: NOK fell 1.7%, AUD dipped 1.0%, and NZD closed 0.6% weaker. Yesterday’s one-week repo auction saw feeble demand, with only USD 44mn secured amid a modest USD 100mn offer. The average rate was set at 2.26%. Hence, today the volume of banks’ FX repo debt to the regulator is to decline to USD 33.8bn.
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