UBRD: CBR’s Key Rate Might Only Drop A Little

13 December 2019 (09:15)

UrBC, Yekaterinburg, December 13, 2019. According to the Ural Bank for Reconstruction & Development (UBRD), the Russian Central Bank's next meeting on December 13 will very likely result in a drop in the key rate down to 6.25% p.a. (-0.25%).

The bank's representative believes the declining key rate will have a very modest impact on the Russian ruble's exchange rate against other global currencies.

'Since the key rate will probably only go down a little, these expectations have already had their effect on the exchange rate. We expect the U.S. dollar to cost around RUB 63.5-64.5 per dollar. The Euro is expected to cost around RUB 70.3-71.7 per euro by the end of 2019. Next year, the euro/ruble exchange rate could be around EUR1/RUB 73 on average, while the dollar/ruble exchange rate might come to USD1/RUB 65. As for new investors, based on the general market rules,
these arrive when the key rate goes up. If the key rate goes down, investors prefer to start looking for other, more profitable markets,' says Operation Director at the UBRD Treasury Vladimir Zotov.

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