Page 95 - RusRPTJan23

- minus 15.3% since December 1 (from 8.6 to 9.9 rubles per yuan).
Before the start of the war, the stability of the ruble exchange rate was ensured by the budget rule, according to which most of the oil windfalls at high oil prices went to the National Welfare Fund. With the outbreak of war, the rule was suspended, and the ruble actually became a derivative of the Russian foreign trade balance.
A strong (60 or less per dollar) ruble was associated with a record trade surplus. The calculations of analysts who predicted the weakening of the ruble by the end of the year are related to the fact that imports will gradually recover as businesses adapt to the new sanctions regime, and exports will fall as new sanctions come into force. This is exactly what is happening - monthly statistics of the Central Bank indicate that the trade surplus is declining. But this does not explain such a sharp fall in the ruble as in early December.
Low cost of Russian oil and concerns about export volumes. In December, the average price per barrel of Urals dropped to $56 from $66 in November. At the same time, in the first full week of the oil embargo, offshore oil exports from Russia more than halved from 3.46 million to 1.6 million barrels per day.
Growth in demand for foreign currency. Investors go into protective assets, buying foreign currency. Before the holidays, imports also traditionally increase.
Chronic geopolitical tensions. For example, on Monday, when the dollar and the euro added 3 rubles a day, the pressure on the Russian currency increased due to the meeting between Vladimir Putin and Alexander Lukashenko. These talks heightened fears that Belarus could become a party to the conflict in Ukraine.
Anomalous activity of anonymous large players - if it was. The market can be affected by single large currency transactions. According to analysts at Tinkoff Investments, trading volumes in the USD/RUB pair on the Moscow Exchange jumped by 50–70%. But whether there were large single transactions and who could become a buyer is unknown.
95 RUSSIA Country Report January 2023 www.intellinews.com