Page 68 - RusRPTOct21

7.0 FX
RUSSIA -FX
2Q19
3Q19
4Q19
1Q20
2Q20
3Q20
4Q20
1Q21
2Q22
3Q22
Sep21
Currency (units per EUR) (eop)
72.1
71.5
69.8
76.3
78.9
88.7
91.3
90.6
88.8
86.4
84.2
Currency (units per USD) (eop)
64.3
64.7
63.0
69.3
71.7
75.4
76.5
75.5
73.8
73.4
72.7
Currency (units per EUR) (average)
72.6
72.0
69.7
73.3
79.5
85.9
90.8
89.6
89.4
86.4
85.8
Currency (units per USD) (average)
64.6
64.7
62.9
66.5
73.8
73.6
76.2
74.3
74.2
73.0
72.9
source: CBR
Oil prices touched $80 per barrel at the end of September and was up 20% in the month as well as 50% since the start of the year. Yet the soaring oil prices have had very little effect on the ruble, which was trading at RUB72.7 per dollar as of the end of September just as the oil price added nearly $10 over the same month.
World market prices for some other export products important to Russia, such as ferrous and non-ferrous metals, wood products and fertilizers, have also risen. This haseen passed on to Russian export prices, which have risen very sharply, and to metals to levels not seen for a decade. The Background is the strong growth of demand in the world economy and several commodities, and in the case of oil, e.g. production in some OPEC + countries even follow the production limits of the agreement,bank of Finland Institute for Economies in Transition (BOFIT) said in its weekly update
Although Russia's export earnings have naturally increased much with the rise in export prices, the ruble has strengthened only slightly. For example, the average exchange rate in September against the dollar was 72.75 as of October 1, down 2% YTD. The ruble has fared even worse against the euro and is less than 1% higher than the average exchange rate in August and is down 8% since the start of the year.
As the Russian economy returns to normal – it haseen growing since March and put in a record 10.7% growth in the second quarter q/q on low base effects – the so-called budge rule isack in effect, siphoning excess oil revenues out of the government’s coffers and squirrelling them away in the National Welfare
68 RUSSIA Country Report October 2021 www.intellinews.com