Russian FX: Executive View On Ruble, Oil

Russian FX Executives See Correlation Between Ruble And Oil Price

A September survey carried out in Moscow by Bloomberg shows a majority of Russian executives pointing to the correlation between the ruble (Russia’s official currency) and oil prices to either “strengthen or remain unchanged” in the next year. Results were garnered from a high-level mix of corporate treasurers, traders and market strategists who were in attendance at Bloomberg’s FX16 event held in Moscow on September 8.

The event, which drew more than 650 markets professionals, polled 130 FX market participants. Further results point to roughly 72% (three-quarters) of those surveyed as expecting to see the ruble and oil prices gaining ground over the next year and some 30% of Moscow-based firms believe market volatility will dampen their hedging prospects within foreign exchange. A smaller percentage expressed regulatory requirements and/or managing currency exposure as their top concern.

A digital display shows the latest U.S. dollar and euro foreign currency exchange rate outside a Bank Saint-Petersburg bank branch in Saint Petersburg, Russia, on Thursday, Dec. 18, 2014. President Vladimir Putin struck an uncompromising stance over the crisis gripping Russia, accusing the U.S. and European Union of trying to undermine his nation and blaming external factors for the ruble's sharp drop. Photographer: Andrey Rudakov/Bloomberg

“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,” Tod Van Name, Global Head of Foreign Exchange Trading at Bloomberg L.P., said. “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.”

Bloomberg has held regular FX symposiums throughout 2016 in an effort to educate clients and markets on the robust offering it offers for participation within foreign exchange markets. More cities and partnerships are expected to be announced soon as the company’s presence in the foreign exchange space continues to grow globally.

A closer look at the results and event show there is no solid consensus on the biggest risk to the ruble in the coming year. However global events are on the minds of Russian executives. Nearly one third (30%), of respondents cite “geopolitics and sanctions” as the biggest threat, with just under one-quarter (23%) of respondents considering a pending US interest rate hike as the most critical threat. Contrarily, noted Bloomberg, very few respondents cited the Russian elections or the current situation ensnaring the Chinese economy as the biggest risks to the ruble, 12% and 5% respectively.

Photo Credit: Andrey Rudakov, St. Petersburg, Russia, for Bloomberg News