Analysts at Danske Bank forecast USD/RUB at 72.00 in one month, at 72.00 in three months, 71.00 in six months, and at 70.00 in twelve months. They argue the risks for the Russian ruble shifted from geopolitics toward a strengthening of the US dollar.
“RUB has faced a number of headwinds since mid-2020: inflation has come up, oil prices have been low and amid lockdowns, activity has remained weak. In turn, improvement in activity indicators have been slow. Russian politics have also been RUB-negative, though sanctions have been milder than expected. Relations vis-à-vis Ukraine, US and Europe have also been a headwind for FX. However, in recent month(s), the central bank have turned increasingly hawkish and raised interest rates, economic activity has picked up and geopolitical risks faded. RUB have strengthen on this reversal of fundamentals. EUR/RUB has also come lower.”
“We keep our RUB-positive forecast largely unchanged. For RUB, it seems like the key risk has shifted from geopolitics vis-à-vis Ukraine and more so towards a further (large) strengthening of broad dollar.”