Thursday, October 9, 2014

Intervention of the Central Bank will not be able to prevent the fall of the ruble – FinRussia

Intervention of the Central Bank will not be able to prevent the fall of the ruble – FinRussia

Foreign exchange interventions of the Central Bank can reduce the volatility of the national currency, but this method is not able to keep the exchange rate within certain limits. Analysts believe that the Bank of Russia will not increase your sales dollars, most likely, the controller uses other tools of monetary policy.

A leading economist at Alfa Bank Natalia Orlova said that intervention last week proved to be insignificant. Since October 3, has sold at least $ 2.4 billion, compared with March sales is a very small amount. Recall that in March, the intervention of the Central Bank exceeded $ 4 billion, then they were able to keep the ruble on negative news related to the annexation of Crimea.

The main Nordea Bank analyst Dmitry Savchenko believes that foreign exchange interventions are carried out in order to reduce currency volatility, but to keep the ruble within a certain range will be extremely difficult for the Central Bank. However, analysts also believe that the amount of foreign currency sales were small.

According to official data of the Central Bank of the Russian Federation, the volume of intervention in early October exceeded $ 1.4 billion. CB 2 times expanded the boundaries of the corridor of the currency basket in the total amount by 20 cents, and yesterday the regulator also pushed boundaries by 5 kopecks.

PSB Analysts note that the cause of the weakening of the ruble is the lack of dollar liquidity in the market. In addition, the American currency has been actively strengthened, but because of the sanctions imposed in Russia, it was not enough. This is especially true at the moment, when banks need to fulfill their commitments for loans in foreign currency. Experts point out that before the end of the year the situation will not change significantly.

October 8, 2014

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