The night board meeting did not save the country from the currency collapse
Impulsive interest rate increase by the Central Bank (CB) has not stopped the weakening of the ruble. Exchange rate fluctuations only increased. “The ruble is undervalued now,” – says the head of the Central Bank yesterday viewers Nabiullina. But what kind of currency flows and reserves are now after the ruble? Currency earnings convert falling ruble exporters are not required, especially as to the payment of taxes they receive assistance from the state ruble. And the Central Bank’s foreign exchange reserves are melting before our eyes. So, if one does not change the currency for rubles, the course could be anything – at least 100, at least 200 rubles. per dollar. It is this change of course there was panic on Tuesday: the ruble is strengthened, then fell, then froze at the level of 72 rubles. per dollar.
The emergency night meeting of the Central Bank on the revision of interest rates was caused by what happened on Monday depreciation for 8 rubles. per dollar. After trying to influence the situation of the Central Bank exchange rate fluctuations increased only yesterday. The gap between the peak values reached 19 rubles. per dollar. Thus, the behavior of the Central Bank rather intensified panic.
But it’s not just panic. Permalinks officials of the Central Bank on interviews with exporters show a clear shortage of dollars in the foreign exchange market.
In fact, today, few people want to change foreign currency in Russia whose credibility has been undermined by including measures of the central bank.
From the regions have been reports about the lack of currency in local banks. As Interfax reported yesterday, in several branches of a large bank of Khanty-Mansiysk ended in dollars and euros, the bank was forced to suspend their sale.
And in some local banks restrictions on the purchase of a population of large sums of foreign currency. Around the same problems were observed yesterday in Tyumen banks.
At yesterday’s auction hasten the fall of the ruble, at least in the first half of the day. At some points the dollar yesterday was sold for 78 rubles., Euro – for 97 rubles. However, in the afternoon, the ruble still tried to move away from the shock of these values: possibly followed by the Central Bank foreign exchange intervention.
At the time of delivery room rate stood at around 72 rubles. per dollar. At the same time, in some regions of the banks sold the euro yesterday almost 104 rubles., And the dollar – about 90 rubles.
Once again: these signs of movement in the collapse of the national currency were observed after a secret night meeting of the Board of Directors of the Central Bank, which agreed to raise its key interest rate from 10.5 to 17%.
«This decision was driven by the need to limit significantly increased in recent devaluation and inflation risks,” – said the official website of the regulator.
According to stock quotes seem otherwise. The feeling that the Central Bank would only further provoke speculators. Now it seems to somehow keep the ruble from falling into the abyss, the Central Bank will have to spend every night emergency meeting and to raise its key interest rate to 6.10 percentage points.
«We must learn to live in the new area, navigate to a greater extent on its own sources of funding and to give a chance for import substitution,” – said yesterday the TV channel “Russia 24″ head of the Central Bank Nabiullina.
According to her, raising the key rate will lead to higher interest rates on deposits in commercial banks. “For the citizens will be attractive to keep funds on ruble deposits”, – explained Elvira. So, theoretically, should now grow demand for rubles and fall – for foreign currency.
The head of the Central Bank explained that the main objective of raising rates – impact on inflation, the impact of the same on the foreign exchange market will be, she said, “and indirectly nemgnovennym.” Nabiullina promised that the floating exchange rate and high rate strategy speculators make riskier. “We believe that the ruble is now undervalued by all parameters – and state of the economy, and the Balance of Payments. But that he approached the fundamental course, it takes time, “- she added.
However, before we talk about the “undervaluation ” of the ruble, it is necessary that its course was at least something is provided – specific foreign currency assets and foreign currency flows. If we consider that the authorities are now forced to negotiate with the largest exporters of the country and to convince them to throw out their foreign exchange earnings for the domestic market, then it turns out that the ruble is actually provided little long. Exporters do not want to sell the currency – and the course will fly at least 200 rubles. per dollar.
A exporters there is no reason to convert foreign currency earnings into rubles, which are impaired in their eyes. But they have a great reason to require the state ruble generous help. State observe exporters not refuse. At the same time the authorities are trying to do without the introduction of mandatory sale of foreign currency earnings.
While Nabiullina reassured the audience, other representatives of the Central Bank made a startling conclusions. First deputy chairman Sergei Shvetsov said yesterday that in the next few days the situation is comparable with the heaviest period of 2008 and that, following the increase in the key rate may be followed by other actions of the Central Bank to stabilize, reports Tass.
«The situation is critical. What is happening, even in a nightmare could not think of a year ago. But, unfortunately, not always we can foresee even the near-term prospects of our finan cial market. Many participants are in serious condition … Believe me, the choice that made the board of directors of the Central Bank – it is a choice between the very poor and very, very bad “- quoted by Interfax Shvetsov.
Even more pessimistic assessment could be seen yesterday in the foreign press. How to write Welt, if the country’s central bank arranges an extraordinary meeting at midnight and decides to hike rates – this means that the regulator is in a panic. The Wall Street Journal described the events in Russia as “Putin’s collapse of the ruble,” and warned that “the wounded Kremlin” can be very dangerous.
Telegraph believes that the financial crisis in Russia has become systemic. According to experts of the newspaper, the hope of the Russian authorities on the foreign exchange reserves can not be justified. Their country has not so much as I, especial ly given the need to service external debt, and now chronic shortage of capital. According to Telegraph, a dangerous trait for Russia – 330 billion dollars. In foreign exchange reserves. According to the Central Bank, in early December in reserves was 416 billion dollars. – A nearly $ 100 billion. Less than it was at the beginning of 2014.
Experts “NG” confirm that confidence in the ruble is now smaller and the population, and business. “Rate of 95 rubles. against the euro and 75 rubles. the dollar – a demonstration of the impotence of the Central Bank. Even in the face of constant growth of the Russian economy to recover external investment and confidence in the ruble will need at least five years “- says financial analyst Lionstone Investment Services Ani lace. But sustained economic growth is not observed.
The credibility of the ruble – is trust primarily to the gove rnment, the expert continues Russian School of Management Kirill Linnik. “Based on the observations of the market last four to six months, it appears that the ruble is not backed by anything, including guarantees of the Central Bank. Confidence in the ruble is still there, but the credibility of the central bank and the government is melting with each passing hour, “- said a senior analyst” Alpari “Anna Bodrov.
«Ruble really finally lost the confidence of the investors. No action of the Central Bank still can not not that strengthen, at least just to stabilize the exchange rate. This situation will continue as long as the Central Bank does not really begin to take effective measures, including the introduction of certain foreign exchange restrictions, “- says the analyst of” InstaForex “Anton Fomin.
However, the deputy chairman of Loco-Bank Andrew Lyushin warns: “Measures such as the compulsory sale of foreign currency earnings, can help in the moment, but in the long-term control over the currency market impact negatively. Since the company will be unable to dispose of their revenue at its discretion ».
«weakening of the ruble more technical point. Once the cash will come back to normal, the ruble exchange rate will return to normal on the basis of fundamental factors, “- hopes principal analyst Alexei Kozlov UFS IC. But how to deploy these streams?
«Today we can not objectively assess the prospects of the ruble – credibility seriously undermined. However speedy recovery image of the domestic currency is still possible. But for this, I think, should be involved not economic levers, “- says the deputy director of the company” FinExpertiza “Natalia Borzov.
The Fall of the Russian currency would not be so rapid, if the Central B ank to actively support the exchange rate at the expense of international reserves, says analyst investment holding “Finam” Anton forty. According to him, these days, like yesterday, the foreign exchange market are times in five years, while in developed countries, and even rarer.
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