Russian FX Executives Expect The Correlation Between The Ruble And Oil Prices To Strengthen Or Remain Unchanged
September 26, 2016
Bloomberg poll also shows they agree with the decision to free float the ruble
Moscow, 26 September 2016: Moscow based firms expect the correlation between the ruble and oil prices to strengthen or remain unchanged in the next year, according to a Bloomberg foreign exchange survey of traders, strategists, and corporate treasurers, issued today.
The survey was conducted at a Bloomberg FX16 event on September 8 in Moscow which attracted more than 650 attendees. During the event 130 FX market participants were polled and the results show that:
• Nearly three-quarters (72%) of respondents expect the correlation between the ruble and oil prices to strengthen or remain unchanged in the next year, with the remaining one-quarter expecting the correlation between the ruble and oil prices to weaken.
• In approaching the second anniversary of the free-floating ruble, the majority of FX executives (79%) agree with the decision to have put this in place. Disparities exist with regards to the timing of the decision, as 39% of respondents feel it should have been implemented sooner, versus 11% who said it should have been later.
• 30% of Moscow-based firms feel that hedging against market volatility serves as their greatest FX challenge, while 22% cite navigating regulatory requirements or managing currency exposures (20%) as hurdles.
• There is no consensus on the biggest risk to the ruble in the coming year, but the majority, nearly one third (30%), of respondents cite geopolitics and sanctions as the biggest threat; just under one-quarter (23%) consider US rate hikes as the most critical threat, followed by commodities (18%). Contrarily, very few respondents cited the Russian elections or the Chinese economy as the biggest risks to the ruble, at 12% and 5% respectively.
“Bloomberg has been in Russia for almost 20 years. We are working closely with firms in Russia to provide the technology and services needed to address the increasing challenges they face, including market volatility and evolving regulatory requirements,” said Tod Van Name, Global Head of Foreign Exchange Trading at Bloomberg L.P. “Additionally, our FX16 symposiums provide a forum for FX experts around the world to network among their local community while sharing ideas that drive business growth and efficiency.”
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