Societe Generale has offered to make a bet on the dollar


The ruble is already the fifth trading session completes the strengthening of the dollar against the background of significant growth of oil prices (+4.2% to $50/bbl.). The growth in the last trading session turned out to be less significant than in the previous days (+0,3%), including on the background is not the most positive for the demand for risky assets the outcome of the ECB meeting.

As of 13:00 GMT on 9 September, the dollar was worth RUB against 64,2046 63,7211 at the close of trading on 8 September.

Analysts at Societe Generale believe that the G10 currency most likely strengthening of the dollar, in particular, taking into account the fact that the small amount of possible policy tightening by the Federal reserve system (FRS) is now included in the quotes of the currency market.

According to analysts of the SG of the fed until the end of 2017 with a probability of 39% will raise the rate once, 25% chance to bet twice. The likelihood that the Agency will leave the rate at its current level of 0.5%, which analysts have estimated at 24%. The Agency has repeatedly postponed a decision on raising rates, which put downward pressure on the dollar, but that, analysts say, will not last long.

The growing volatility

The market expects minor growth in the market volatility in September. As noted in the report of the Central Bank “liquidity of the banking sector and financial markets is due to expectations of increase in vibrations of oil futures Brent and restoration of elasticity of the ruble in oil prices to the long-term average.

Reducing the volatility of quotations of oil futures in August helped to maintain a reduced level of volatility of the ruble relative to the average values for the year 2016.

In August, the ruble has appreciated against the dollar. This contributed to the growth of quotations of oil futures on the news about a possible new round of negotiations on the freezing of oil production between OPEC and other oil producers. At the same time, factors such as the strengthening of expectations of increase in the key rate of the fed on the background of the comments of its leaders, as well as access data on the growth of drilling activity and crude oil inventories in the US has not had a significant impact on the change in the price of oil.

In August, the elasticity of the exchange rate according to the quotations of oil futures are expected to start to recover after its decline in July due to the growth of sales volume of export currency proceeds under the payment of dividends. On the background of the end of the period dividend payment in August declined the offer of currency from exporters and the demand of non-residents for currency conversion dividends received notes to the Central Bank.

Falling in August, the fluctuation of the exchange rate and a favourable domestic stock market boosted the demand of non-residents in OFZ bonds, in particular, in connection with the use of these papers in the transactions of carry-trade. As the regulator, the Russian husbandi was attractive to investors because of their higher yields compared to government bonds of many other developing economies.

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