As Russia is a major exporter of Crude oil and Natural Gas, the Russian currency moves in tandem with the energy prices. 2015 proved to be a trouble for Rouble, for the latter became a prey to the rout in energy complex. The plummeting oil prices became a pain for RUB so much that it lost more than 50% of its value in this year making new lows around 73. While the Western sanctions imposed by US and EU on Russian banks and some of its state companies, added fuel to the fire which worsened the situation of Rouble even further.
With the onset of 2016, factors like vigorous dollar, outflow of funds due to rate hike by FED, geo-political tensions, economic slowdown in Russia with issues of stagflation and drastic mismatch in supply and demand of Brent Oil are likely to put pressure on Rouble. Although Central Bank of Russia is taking steps to restock its foreign currency reserves, the stabilization in Brent Oil will be majorly important in preventing the weathering of the Russian currency.
Rouble being placed at its all time low, has no defined upside, where in we can expect it to go further lower from its current levels if the supply remains unrestricted by the OPEC countries. The pace with which oil countries are pumping oil off the grounds, for once it can be said that this carnage will continue in 2016, taking the Russian currency further down from their all-time lows. Thus, Rouble would be expected to face an unfortunate year once again unless oil prices show some wonders.
With the onset of 2016, factors like vigorous dollar, outflow of funds due to rate hike by FED, geo-political tensions, economic slowdown in Russia with issues of stagflation and drastic mismatch in supply and demand of Brent Oil are likely to put pressure on Rouble. Although Central Bank of Russia is taking steps to restock its foreign currency reserves, the stabilization in Brent Oil will be majorly important in preventing the weathering of the Russian currency.
Rouble being placed at its all time low, has no defined upside, where in we can expect it to go further lower from its current levels if the supply remains unrestricted by the OPEC countries. The pace with which oil countries are pumping oil off the grounds, for once it can be said that this carnage will continue in 2016, taking the Russian currency further down from their all-time lows. Thus, Rouble would be expected to face an unfortunate year once again unless oil prices show some wonders.
