Experts say that currently nothing can support the rise in the American dollar exchange rate. First of all, traders are worried over sluggish growth of the US economy. For this reason the Federal Reserve may postpone a rate hike which was planned for this year, and in that case the greenback may suffer a massive sell-off.
Goldman Sachs shares this opinion, pointing that this year even neutral news triggers a fall in the US dollar, while positive news contribute to a slight increase only. The Russian ruble benefits from this situation. Vladimir Potapov, CEO at VTB Capital Investment Management, said that the Russian currency should be cheaper by 5-6 percent given the current oil prices. With the difference in interest rates and oil prices trading in a certain range that is comfortable for the budget, the Russian ruble will likely gain ground unless some negative geopolitical factors arise, the economist added.
Though the ruble depends on oil prices greatly, the difference in rates also provides support to it. However, at its last policy meeting the Federal Reserve announced plans to reduce balance sheet which may be considered as tightening to a far greater extent than a rate hike. The question is when the Fed will conduct this operation.
