For 3rd day on a row, Russia’s major currency, Ruble has weakened against the greenback. The value of Ruble has actually slid down to the lowest value within the last 8 weeks. It has been reported that the importers of different consumer goods have bought foreign currency during the busiest shopping season of the year and this probably had a negative impact on the Ruble.
Incidentally, Ruble’s drop is the biggest since 23rd October and today it has went down by 0.7% against USD. It is currently priced at 30.9400 per USD. Ruble’s losing streak of 3 days also marks the longest streak since 29th October. Not only that, but, Ruble has also plummeted by 1.1% against the target Euro-USD basket set by Central Bank and is at 35.3678 now. Ruble has suffered declines against Euro as well. It is down by 1.4% against Euro and is currently at 40.7795 per Euro. The index (This has been compiled by Micex) suggesting five-year Government bond yields has shown an increase of 6 basis points to 6.48%.
The Chief Economist for the Investment-Banking unit of Moscow division of Barclays Plc., Vladimir Pantyushin stated that the sellers of consumer goods are into active buying mode of different foreign currencies. Most of these sellers are dealing with electronic goods. Vladimir added that the sellers should pay for different goods to be delivered to Russia. However, Vladimir commented that the overall sales have gone to a stronger level ahead of the holiday season.
Based on a recent report published by Vedomosti, an average Russian citizen intends to spend $503 during the holidays observed in the year-end. This marks an increase of 9% from that of 2011 and that according to many economists, is a positive sign for Russian economy. However, due to more spending on foreign currency that growth is not positively attributing to Ruble’s growth. The report also states that OAO M.Video, a renowned Electronics retailer of Russia is the most favorite stock choice at the Credit Suisse Group AG.
In last 3 months, the Ruble is at 31.4072 against USD, based on non-deliverable forwards. On the other hand, the extra yield investors demand to own Ruble bonds over US Treasuries went down by 3 basis points and are currently at 173. The index named EMBI Global Index is maintained by JPMorgan Chase & Co.