Morgan Stanley recommends buying the ruble against the dollar
Apr 10, 2019

Morgan Stanley recommends buying the ruble against the dollar

Morgan Stanley added a recommendation to sell the dollar against the ruble, rejecting concerns about possible new sanctions, the company said in a review.

Morgan Stanley also advises longs on other em CURRENCIES on expectations of a General weakening of the us dollar (USD).

The chances of sanctions against the debt of Russia, Russian banks are low, analysts previously wrote Eurasia Group. The ruble is now actively growing against the backdrop of a General surge in risk appetite. Global stock markets reached their peak in 5 months. Investors expect to soften the rhetoric of the Federal reserve against the background of the latest series of data that fell short of economists ' forecasts.

The ruble rose on Monday due to the tax period, the demand of non-residents for OFZ, expensive oil and seasonally strong current account of the Russian Federation. In favor of the ruble as a high-yield EM currency - expectations of softening the rhetoric of the US Federal reserve at the end of the meeting on March 19-20, and for the OFZ market support is expected to soften the tone of the Bank of Russia this Friday, which makes it interesting to buy ruble debt, even regardless of the external background, writes Reuters. Forced closure of long currency positions also played a role.

“In the foreign exchange market, exports sell revenue, which knocks people out of long currency positions, it began on Friday in the illiquid market, continued today. Plus, we see that OFZs are bought today quite actively by foreigners,” said Artem Zvonarev from VTB Capital.

According to him, in the absence of serious currency demand in the market, the ruble has the potential for further strengthening.

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