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Pundits foresee no turmoil on Russian currency market

March 03, 2015, 18:57 UTC+3 Alexandrova Lyudmila
© Mikhail Pochuyev/TASS

MOSCOW, March 3. /TASS/. The exchange rate of Russia’s national currency seems to have regained relative stability and, according to domestic economic pundits, it will stay where it is for the time being or even get slightly firmer, if there are no more oil price slumps or other external shocks. The federal government and the Bank of Russia have managed to keep the situation under control so far.

Of the past eight months February was the best of all for the Russian currency, which gained 13% against the dollar and 14% against the euro. After the slump last December and January it was the first favourable monthly trend.

Although March trading on the currency market opened with the ruble’s slight downward adjustment, experts believe it will not last. At the same time others do not rule out the reverse march of events, as exporters will soon have to settle a $20-billion foreign debt, which will surely push up the demand for hard currency.

Alfa-Bank has tried to calculate the dollar’s fair rate in five different ways. The results ranged 18.5 rubles to 63 rubles depending on the calculation method chosen.

The two most accurate methods of evaluating the ruble’s future rate indicate that if the 2015 oil price is above $60 per barrel on the average, the ruble will have chances to gain strength. "This opinion fits in well with the current forecast of the exchange rate for 2015 — 55 rubles per dollar," Alfa-Bank says in its review.

Uralsib Capital’s chief economist, Alexey Devyatov believes that the ruble may be up to 53.2 rubles per dollar by the end of 2015 on the average. "But the risk of making a mistake is now rather high," RBC Daily quotes him as saying.

Deputy Prime Minister Arkady Dvorkovich sees eye to eye with the chief of the Federal Antimonopoly Service Igor Artemiev in the sense part of export payments for Russian crude should be accepted in rubles only. A decision to sell ten percent of crude for rubles would force importers to purchase $15 billion worth of Russian money, and this amount is comparable to interventions by the Central Bank.

Specialists at the Higher School of Economics TASS has polled are pessimistic about the effectiveness of such proposals.

Senior lecturer Alexander Abramov, of the stock market and investment market chair at the HSE, sees no need at the moment for dictating terms to exporters. The expert gave the government’s and Central Bank’s performance a four-point mark on a five-point scale. "As crisis managers they have kept the situation under control pretty well," he said.

The leading expert at the Development Center of the Higher School of Economics, Sergey Pukhov, believes that trading part of crude for ruble cash to non-CIS countries will be hardly possible. "In any case, such a measure will not cause any real effect on the market."

Assistant lecturer at the stock market and investment market chair, Alexander Arshavsky, has described the idea as "good but hardly realistic."

"There is no way of dictating to anyone. Will exporters and importers agree to this?" he asked.

As for the ruble’s future, HSE specialists see no risk of a catastrophic collapse of the national currency. "If the current factors (sanctions and oil prices) remain unchanged for several months, the government and Central Bank will manage to keep the ruble’s rate under control. They have developed the knack for that," Abramov said. "The Ministry of Finance has sold part of the currency from the reserve fund. Possibly, there will be more moderate sales. If no external shocks follow, the ruble’s rate will be oscillating around 60 rubles per dollar."

"The ruble’s rate depends on oil prices to the greatest extent, while all other factors (such as lack of investment and capital flight) are of smaller significance," Pukhov said. "In the medium term the oil prices will be falling and the ruble getting weaker."

"The price of oil seems to have returned to stability and is oscillating within a range of two dollars per barrel either way," Arshavsky said. "So is the ruble." A sharp fall of oil prices can hardly be expected, so the expert does not share catastrophic expectations.

"If there are no extra shocks. If what we have today remains unchanged, the situation will remain basically the same with a slight downward trend," he said.


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