Monday, November 10, 2014

The central bank has canceled the currency corridor – RBC

The central bank has canceled the currency corridor – RBC

From November 10, the Central Bank has changed the parameters of the exchange rate policy – Remove the currency corridor, which existed from the end of 2008, and canceled regular foreign exchange intervention. “Instead, we will go into the currency market with interventions at any time and in the amounts that are needed to bring down the excessive, speculative demand,” – said the head of the Bank of Russia Elvira Elvira in an interview, “Russia 24».

Earlier, the Bank of Russia has promised to move to a floating exchange rate with the January 1, 2015. But market participants have already said in October that the dismantling of the currency corridor occur prematurely. The ruble weakened heavily on these rumors on the eve of the meeting of the Board of Directors of the Bank of Russia on 31 October. On the day of the Board of Directors nothing has been announced, but in the next business day – Wednesday, November 5, the regulator said that will not be spent on the intervention of more than $ 350 million a day.

The market participants, interviewed by RBC, called this action the actual transition to a free course. Indeed, even in the same day, the ruble was moving out of the corridor: November 5 corridor boundaries were set at 39,6-48,6 rubles. But during the trading session currency basket value reached 50.09 rubles.

“Despite the fact that market participants were ready for it yet on October 31 took three additional crazy shopping session, to control shared this view, refusing to” hack tail piece by piece. ” During the week postprazdnichnuyu currency basket increased by more than 10%, jeopardizing financial stability “, – pointed with his review of the investment department chief analyst Stanislav Kleschev VTB 24.

Abolishing corridor, CB said that now the market has new source of currency. Exchange rate policy now provides that the operations in the domestic market will be mainly carried out on a return basis, said Monday the Bank of Russia. Back in October, he announced the launch of a new tool – the repo currency. It is this tool should, on the idea of ​​the Central Bank, to become the main foreign exchange market. Repurchase will be issued to banks for three terms – a week, 28 days a year. The first auction of the year at the exchange repos held on November 17.

On Monday Elvira in an interview to “Russia 24″ stated that the Bank of Russia intends to temporarily restrict the provision of ruble liquidity to banks. “Because it is not only used for the financing of the economy, but also to play on the foreign exchange market”, – explained Elvira. In November, the debt of the banking sector to the Central Bank of the Russian Federation reached a new historical high – 6.5 trillion rubles, an increase of almost half a year to 1.5 trillion.

All these news ruble on Monday continued to strengthen, started on Friday: he grew to 19.00 against the dollar by 2.3%, to 45.6 rubles., the euro – by 2.42%, to 56.72 rubles.

Warning speculators – good news for Russia the foreign exchange market, the analyst of “Opening Broker” Andrew Cochetkov. “One of the factors weakening ruble all the experts believed that the Central Bank has provided ruble liquidity in unlimited amounts. All the money went to currency speculation. The banks have no incentive to use them to maintain the industry, private lending, etc. Banks buy currency, gathering more profitable to sell it to recover the funds of the Central Bank and at the same time be able to earn, “- he says. So as soon as there is information that the Bank of Russia to reduce the volume of ruble liquidity provided, the ruble appreciated adds Cochetkov.

Following a statement on the Moscow Stock Exchange Nabiullina dollar fell by 50 kopecks., To 45.04 rubles. the dollar, the euro – 60 kopecks. to 56.33 rubles. per euro.

«It is not clear exactly how CBA can limit exactly the ruble liquidity that banks take it to purchase foreign currency,” – chief doubts dealing center Metallinvestbank Sergey Romanchuk. In his opinion, banks are now very dependent on the Central Bank’s refinancing and cancellation of these loans will lead to an increase in lending rates by banks.

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