“Roscongress”: According to current policy, the ruble may fall to 110 rubles per dollar

MOSCOW, September 19 – RIA Novosti. The exchange rate of the Russian currency will lose 2 rubles per month and fall to 110 rubles per dollar and below by the beginning of the second quarter of 2024, if the current conditions and monetary policy remain unchanged, but the launch of its 100% repatriation is expected to increase according to the Roscongress review by RIA Novosti “Prospects for the ruble: Currency control or devaluation?” According to the report, foreign exchange earnings can even exceed the budget-friendly range of 80-90 rubles per dollar.

“The current approach, which allows exporters to hide foreign currency earnings outside Russia, inevitably leads to a weakening of the ruble… In fact, exchange control measures, including an increase in the sale of foreign currency earnings, are now the only opportunity. They are confident experts who say “Quickly return the exchange rate to more or less comfortable values.”

“With a 100 percent return of foreign exchange gains, we will observe a serious strengthening of the ruble even above the range of 80-90 per dollar, despite all the factors voiced by the head of the Central Bank,” they believe. The regulator’s head, Elvira Nabiullina, said on Friday that authorities were discussing repatriation of foreign exchange earnings, but that was unlikely to have a major impact on the ruble exchange rate: repatriation does not mean repatriating the entire volume. the money will go to the market, it can easily be settled in foreign currency accounts already in Russian banks.

Roscongress experts refer to the statement of the First Deputy Prime Minister of the Russian Federation Andrei Belousov at SPIEF 2023, who said that the exchange rate of 80-90 rubles per dollar is comfortable for the budget. “If we remove the speculative component, then the fundamental assessment of the fair value of the ruble will be close to these values,” Roscongress admits.

“But no fundamental assessment will work until the regulator stops the actions of speculators in the foreign exchange market. To correct the situation, we need both a change in the fiscal rule mechanism and clearer signals from the Central Bank.” the document says.

Experts also acknowledge that sanctions and geopolitical tensions continue to put additional pressure on the ruble. “Geopolitics currently remains one of the most important factors affecting the ruble exchange rate. Improving the geopolitical agenda will lead to both an increase in Russian oil prices and a decrease in capital outflow, but also increase the inflow of foreign currency at least part of investors’ funds” – says the report.