EUR/RUB Outlook:
The EUR/RUB pair is slightly positive, but likely to move sideways as it is just below its 90-day average and near its mid-range. Lack of clear drivers supports a stable outlook for the near term.
Key drivers:
• Rate gap: The European Central Bank is maintaining interest rates at 2.00%, while the Central Bank of Russia's stance hints at softening policy in response to low inflation, impacting relative currency strength.
• Risk/commodities: Oil prices are currently above average, which tends to support the ruble as a commodity-linked currency; however, ongoing volatility could lead to fluctuations.
• Macro factor: The expected Eurozone inflation indicator suggests a stable economic environment, but any downturn in anticipated growth could limit the euro’s appreciation.
Range:
The EUR/RUB is likely to drift within its recent range, as current conditions suggest no strong catalysts for significant movement.
What could change it:
• Upside risk: A stronger-than-expected inflation report from Germany could boost the euro.
• Downside risk: Increased geopolitical tensions or negative sanctions developments could weaken the ruble significantly.
