The beginning of a new year failed to become a pivot point for Russia’s national currency. The ruble continues its steep decline as well as the Russian stock market. Thus, this year’s first working week on the Moscow Exchange was marked by a slump in the ruble. Currency market statistics show that the single European currency managed to add 3.35 rubles, while the US dollar rose by 1.5 against Russia’s ruble. The EUR/RUB and USD/RUB pairs hit the levels of 83.97 and 76.31 respectively for the first time since December 2014.
A decline in global crude prices remains the major reason behind such negative dynamics. The Russian economy promptly responds to any, even marginal, fluctuations in black gold price, which tend to be ample over the recent period. For the first ten days of 2016, Brent crude lost 12.5%. The international benchmark continued its downward journey during the London Exchange trading session on January 11. So, Brent oil fell by 3.02% to the level of $32.52 a barrel, and the market response was immediate. The MICEX index plummeted by 2.5% that day, and the RTS index was more than 4% down.
In the light of the recent events, some experts sarcastically remember the latest forecast of Goldman Sachs analysts made at the end of 2015. They advised market participants to invest in Russia’s national currency, arguing that the ruble looked oversold and had a good chance to pare its losses even with a moderate rise in crude prices.
