US Fed rate increase, the possibility announced by the head of central bank Jerome Powell, means another round of strengthening dollar in the global market. Given this fact, you should probably expect weakening not only of the ruble and other emerging market currencies, but also of euro, since in the eurozone all signs of a full-scale recession are only growing, and capital goes to the United States. This opinion was told to “Invest-Foresight” by head of the analytical department of AMarkets Artem Deev.
Jerome Powell at the end of last week said the regulator would continue raising rates, realizing the risks of a slowdown in the economy (which dropped immediately stock markets worldwide).
In addition, internal factors play on the weakening of the ruble: possible early start of application of the new fiscal rule and currency interventions by the Ministry of Finance (increasing demand for foreign currency within the Russian Federation), growth in volumes of parallel imports (the need to purchase currency from business will also pressure on the national currency). Among the external factors the prevailing ones will be a Fed rate level and quotes for oil prices, the analyst emphasizes. The latter, although they will remain high (compared to last year), will probably decline after OPEC+ predicts once again reduced demand due to global recession and declares that there will be no great increase in production.
“As a result of the combination of factors, you can expect a rise in value of dollar to the level of 65-68 rubles by the end of September 2022”, – Artem Deev predicts.