The Russian Reference Rate is reported to be 4.25% in January 2021. This figure is constant compared to the previous 4.25% for December 2020. The Russian Reference Rate data is updated monthly, with an average of 7.75% from September 2013 to January 2021. Inflation is expected to be in the 4.6-4.9% range by the end of 2020. However, policymakers see annual inflation at 3.5-4.0% in 2021 and stable at close to 4%.
The Ruble continues to gain traction, strengthening against the USD over the past 5 days amid rising crude oil prices which is a booster for the Ruble. Investors took advantage of the difference in interest rates with the US to carry out a carry trade, thus tilting the bid to the Ruble, which yielded a higher yield. Even though USDRUB is weakening, technically the asset is in neutral bias above the 200-day EMA, with negative bias seen from the MACD as it is approaching the neutral zone. However further decline would be evidenced by a break of the ascending line, to match the low at the 61.8% retracement. As long as the 200-day EMA Support is functioning (because it looks like the slope is still flat) further increases are possible to continue the original uptrend.
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Ady Phangestu
Analyst – HF Indonesia
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