Major Western banks curtail investments in rubles and recommend clients to bet on further decline of the Russian currency due to the risk of sanctions and capital flight.
The first play against the ruble, advised customers of Bank of America Merrill Lynch. Last week, amid a rebound in the dollar by 3.3 ruble and Euro — ruble at 3 to BofA joined other American and European players, according to Finanz.
Betting against the ruble makes Morgan Stanley, the largest Swiss Bank UBS has recommended clients to minimize investment in the Russian currency. Analysts of both banks wrote in the reviews that the risks outweigh the potential income from investments.
The largest US Bank JPMorgan is selling Federal loan bonds, said Bloomberg investmanager units of the Bank assets management Diana Amoah. According to her, the likelihood of sanctions against the state debt of the Russian Federation amounts to 50%, and a high proportion of foreigners in the market creates the risk of significant price declines.
According to the Central Bank, from April, non-residents dumped debt securities of the government of the Russian Federation to 370 billion rubles, and index RGBI, track their quotes, slipped to at least March 2017.
The presence of foreign speculators can be seen in the swap market, says in the overview of Raiffeisenbank.
Non-residents bring to the market dollars in exchange for rubles which attract through swap operations with Russian banks. Those rubles spent on the purchase of foreign currency on the spot market to sell at a higher rate, describes the schema, the analyst of Raiffeisenbank Denis Poryvai.
“The ruble remain very sensitive to potential new US legislation (sanctions), — put in the review Morgan Stanley analysts. — We think that political risk will weigh on sentiment and will lead to higher risk Premia at the ruble closer to September.”