The ruble under pressure: analysts predict a new wave of weakening by the end of summer
After a brief respite in July, when the ruble was able to partially recover from June's losses, the market is once again bracing for pressure on the national currency. A short-term technical correction of 3–5% does not change the overall trend: fundamental factors point to a resumption of the downward movement by the end of summer.
Key benchmarks and fundamental drivers
According to our estimates, based on an analysis of market flows and seasonal patterns, by the end of August we may see the following levels for major currency pairs:
- US Dollar (USD/RUB): a return to June highs and above, up to the 80 ruble mark.
- Euro (EUR/RUB): consolidation near the 90 ruble level.
- Chinese Yuan (CNY/RUB): approaching the 12 ruble mark.
The ruble's dynamics are primarily determined by the balance of supply and demand for currency from exporters and importers. In current conditions, we observe a sustained excess of demand over supply. This imbalance is further amplified by currency purchases under the budget rule, creating constant pressure on the ruble.
Seasonal factor: August is a weak month for the ruble
The seasonal factor deserves special attention. Statistics from previous years clearly indicate that August is one of the most challenging months for the Russian currency. This is due to the typical structure of the trade balance during this period:
- Rising imports: ahead of the autumn season, purchases of goods from abroad increase, boosting demand for foreign currency.
- Stagnant exports: supplies of raw materials and energy typically show no significant growth, limiting the inflow of foreign exchange earnings.
The combination of these two factors traditionally leads to a weakening of the ruble in the last month of summer. The current situation only confirms this historical pattern.
Strategy for investors
In anticipation of further ruble weakening, it seems rational to consider defensive strategies. Among the most obvious options are the direct purchase of foreign currency or futures on it. An alternative could be currency bonds: if the exchange rate rises, they will not only provide coupon income but also ensure capital growth through the revaluation of the face value.
As for the launch of the digital ruble, scheduled for September 1, this factor, in my opinion, will have no impact on the national currency's exchange rate. The digital ruble is merely a new form of fiat money, not an independent asset. Its implementation changes payment methods but not the fundamental parameters of supply and demand in the currency market.
My opinion: the current ruble correction in July is just a temporary pause before a more significant move. Investors focused on capital preservation should already consider hedging currency risks, as August traditionally does not spare the ruble.