EUR/RUB Outlook: Bearish, with the rate currently trading below its recent average and near recent lows, facing pressure from significant external factors.
Key drivers:
• Rate gap: The European Central Bank's focus on maintaining interest rates supports the euro, while the Bank of Russia's higher rate aims to stabilize the ruble against external pressures.
• Risk/commodities: Oil prices are rising and above average, potentially bolstering the ruble due to Russia's reliance on energy revenues.
• One macro factor: The EU’s ban on new gas contracts with Russia is expected to impact ruble values by decreasing export revenues, contributing to downward pressure.
Range: EUR/RUB is likely to drift around its recent lows as the currency pair navigates a narrow range.
What could change it:
• Upside risk: A sudden improvement in geopolitical tensions may lead to a stronger euro.
• Downside risk: Further sanctions against Russia or additional enforcement on energy exports could weaken the ruble even more.