According to the newspaper “Kommersant”, citing data from Emerging Portfolio Fund Research, for the week, Russian funds lost $196 million, which were withdrawn by foreign investors. Three-week loss thus reached the sum of $350 million.
The publication notes that the capital outflow is observed not only in Russia but in other developing markets. The explanation for this is the recent information about the intention of the U.S. Federal reserve to raise the key interest rate. These regulatory actions will strengthen the dollar against the currencies of developing countries, therefore investors are now trying to lock in profits.
Also the “Kommersant” notes that over the past four months, the Russian stock indices have increased in dollar terms more than 40%, second only to the Brazilian BOVESPA index has risen by 58%. In these conditions, as noted by analyst UFG Wealth Management Alexey Potapov, many international investors prefer to take profits and wait until the situation becomes clearer in the oil market.
“Fears about a tightening of monetary policy by the fed, as well as potential growth in the supply of oil in the second half of the year will put pressure on the Russian market in the coming two months,” suggested a senior portfolio Manager of the criminal code “Kapital” Vadim Bit-Avragim.