Alexei Vedev’s Foreign Exchange Forecast

Alexei Vedev, Doctor of Economic Sciences, Head of the Financial Studies Department, Gaidar Institute told the А which factors would underpin and weaken the Russian national currency in January 2022.

“The average price of oil is expected within the range of $70-$80 a barrel. Increased interest rates on deposits and higher yield on OFZ securities will facilitate demand for rubles. A traditional decrease in capital outflow in Q1 2022 will ensure stability of the Russian currency.

What can weaken the ruble in January? The effective fiscal rule will facilitate $6bn-$7bn worth of foreign exchange purchasing by the RF Central Bank on order of the RF Ministry of Finance. A somewhat pickup in demand for foreign exchange during New Year holidays will be a factor that is weakening the ruble in January.

The most likely scenario for January is the stable exchange rate in the band of Rb73-Rb47 per $1.