The ruble unexpectedly fell above 92.70 rubles/$ - what’s happening?

In the first half of Thursday's trading session, the ruble experienced a sharp decline.

The dollar's exchange rate rose by over two rubles in an instant.

The ruble has declined due to the expiration of currency futures and an increase in seasonal demand for currency.

On Thursday, the dollar exchange rate rose to its highest level in two weeks, reaching 92.70 rubles/$.

Interfax-CEA has noted that the fall of the ruble is due to the seasonal increase in demand for currency before the winter holidays, as well as the pressure of speculative transactions, which was exacerbated by the expiration of currency futures contracts on December 21.

BCS notes that the ruble comes under seasonal pressure in the second half of December due to increased demand for currency among individuals for the winter holiday season, as well as to save salary bonuses paid at the end of the year.

ruAt 12:15 Moscow time, profinance.ru reported a sudden surge in the dollar's value, which lasted until 12:30. This increase was likely due to speculative operations in the lead up to the December 21 expiration of currency futures contracts.

Experts from SberInvestments suggest that the short-term weakening of the ruble could be due to the demand for foreign currency related to the redemption of Eurobonds. On Thursday, PJSC Koks paid off $350 million worth of dollar bonds in rubles ahead of schedule.

The news of potential issues for exporters could have a negative effect on the Russian ruble. According to Bloomberg, three ships carrying a total of almost 5 million barrels of Russian oil have yet to reach their destination in India, and have been idle in the waters south of Sri Lanka for up to a month.

Exporting companies are preparing to make tax payments to the budget on Thursday, December 28th. These payments include VAT, insurance premiums, personal income tax, mineral extraction tax, and excise taxes, all of which will help to support the ruble.

The PSB has stated that the recent decline of the ruble is localized and that the rise in foreign currency sales by exporters will balance it out.

It is not anticipated that the ruble exchange rate will experience any more major depreciation in the upcoming months by VTB My Investments.