Russian ruble plunges nearly 30% against the dollar, analyst sees "plenty more room for weakness"
The Russian ruble dived around 29% against the dollar on Monday morning in a record low as markets assessed the impact of sanctions on Russia amid a growing backlash against the Kremlins invasion of Ukraine.
The ruble was trading as low as 119 per dollar as offshore trading started in the morning during Asia hours, from nearly 84 per dollar the previous day, according to Factset data.
Russias central bank on Monday confirmed it had barred its brokers from carrying out sell orders from foreigners as it seeks to contain the financial market fallout. It also said it would be freeing 733 billion rubles ($8.78 billion) in local bank reserves to boost liquidity.
Bipan Rai, senior macro strategist at CIBC Capital Markets, told CNBC on Monday before offshore trading started that he expects a pretty significant, steep drop in the Russian currency in time to come. In a scenario where the Russian currency has pretty much lost all value outside of the country, Russias central bank would probably have to hike interest rates very aggressively and sell gold, he said.
And theyre going to do it really with governments that are friendly to them. And that appears to be shrinking by the day, he said, on the move to sell gold.
To me, it doesnt really feel like were looking at or at least were going to see the bottom in the ruble here. I think there still is plenty more room for weakness to come, Rai told CNBCs Street Signs Asia.
https://www.cnbc.com/2022/02/28/russian-ruble-dives-nearly-30percent-against-the-dollar-amid-sanctions-ukraine-crisis.html