RUB still vulnerable to twists in oil market
RUB still vulnerable to twists in oil market

The Russian ruble is not viewed by experts as the weakest currency. Moreover, the ruble occasionally wins the title of the most promising and the most undervalued currency. Indeed, this status is sometimes justified by its remarkable resilience despite headwinds. However, it is doomed to failure as Russia’s government and the central bank are not interested in the strong national currency, thus making no efforts to provide some support. Besides, Western sanctions are the sword of Damocles that hangs over the ruble. Being the commodity currency, the ruble is vulnerable to any downtrend in oil prices. No wonder, the recent slump in oil prices dealt a blow to the Russian currency. In early August, the ruble hit a fresh two-month low and briefly tumbled even deeper. Meanwhile, the ruble cannot meet the challenge of political pressure. In this context, it will hardly regain footing in the short term. One thing is obvious: the dynamic of oil prices is seen as a good barometer of the ruble’s trajectory. The latest nosedive of oil prices caused an instant slump in the ruble. On August 13, the USD/RUB pair tested the level of 65.5975. Likewise, the EUR/RUB pair also breached the level of 73.5550, the weakest mark since early June 2019.   

Published: 2019-08-19 09:14:09 UTC
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