Top Forecaster Says World’s Best Currency Rally Is Heading for a Crash
- PKO’s Kosaty predicts world’s best FX rally will evaporate
- Foreigners have made their rate bets, bond flows set to ebb
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The analyst who most accurately predicted the ruble’s rally in the second quarter is now its most pessimistic forecaster.
The Bank of Russia’s switch to monetary easing is the reason Jaroslaw Kosaty, a currency strategist at Poland’s largest bank, sees the currency sinking about 9% against the dollar by the end of the year. Foreign investors who piled into local OFZ bonds in anticipation of the cuts are largely done staking out their positions and the Bank of Russia says it expects the non-resident flows to fade, exposing the currency to further interest-rate reductions.