After the tax period in Russia ended on January 29, 2024, the ruble began to weaken. During tax periods, domestic exporters often sell large amounts of foreign currency, which pushes down the dollar and euro exchange rates. By 18:59 Moscow time on January 29, the dollar stood at 88.98 rubles, down 0.76 rubles from the previous close. The euro also fell, dropping 1.26 rubles to 96.13 rubles. From January 29 to 13:58 Moscow time on February 5, the dollar rose by 2.22 rubles and the euro by 1.97 rubles.
Analysts note that at the start of each month the ruble tends to weaken due to reduced foreign currency sales by exporters. In addition, the Central Bank’s decision to cut daily foreign exchange sales by 800 million rubles since February 1 contributed to the softness in the ruble during the first days of February, according to market observers.
BCS Forex analyst Anatoly Trifonov highlighted the seasonal pattern and the policy change as key factors. In recent weeks, heightened demand for foreign currency has been seen, which can apply upward pressure on the ruble. This might reflect purchases of imported goods by the state or corporations, including possible prepayments for imports ahead of the long Chinese New Year period in February, as noted by market commentators. He also referenced reports about disruptions in oil supplies to India and new agreements with Turkey that have been affected by sanctions imposed at the end of last year.
Denis Perepelitsa, a scholar of economics and a director at a federal financial literacy center, pointed out that the ruble’s depreciation was aided by speculative currency trading and by a decline in Brent crude oil prices to around 76.9 dollars per barrel. Other market voices emphasized the current trading band, with the dollar hovering in the 87.6 to 93.3 ruble range and the euro trading roughly between 94.45 and 99.3 rubles.
BitRiver analyst Vladislav Antonov added perspective on the potential trajectory, noting the dollar and euro trade ranges and suggesting that if the upper bounds of these ranges are breached, the currencies could test higher levels. He also projected a lower-bound protection level for the ruble in 2024 around the mid-90s to the early hundreds for both currencies. The discussion underscored the combined influence of oil prices, the federal budget balance, and possible shifts in the central bank’s policy stance as the year progresses. Market watchers also anticipated the impact of the presidential election cycle on the pace of ruble movements and exporter sales.
Observers stressed that the duration of elevated dollar and euro levels would hinge on a broad set of factors. These include the broader economic health of the United States and Europe, geopolitical developments, and actions by major central banks. One analyst underscored the possibility that the dollar would not push beyond the 100 ruble mark, arguing that the ruble remains deeply undervalued in a global comparison of monetary aggregates and reserves. The view is that Russia’s geopolitical standing may gradually strengthen the ruble, spelling out a path toward a more resilient exchange rate as the year unfolds.
There is an expectation that the ruble could appreciate gradually in 2024, supported by a more favorable geopolitical climate for Russia and improving domestic fundamentals. Yet, some scenarios acknowledge continued pressure from weaker oil markets and broader weakness in Western currencies against BRICS partners. The balance of risk factors remains delicate, with potential policy responses from the central bank aimed at curbing inflation and stabilizing the currency while managing fiscal considerations. In this evolving landscape, the ruble’s course will likely reflect how oil markets perform, the fiscal outlook, and the trajectory of global monetary policy.