The strengthening of the rouble to a two-year maximum has not led to increased demand for foreign currency
Photo: lime/Zurab javakhadze
The depreciation of the dollar and the Euro against the ruble to two-year low earlier in the year did not lead to excessive demand for foreign currency from the population. This is evidenced by the results of a survey of the ten largest banks conducted by “the News”. This behavior says, on the one hand, the growth of public confidence in the national currency, and on the other a noticeable decrease in speculative activity, experts say. Both trends into the hands of the Central Bank.
Bank customers began to buy up dollars and Euro, despite the fact that rates of these currencies in the first days of the new year fell in the course of trading on the Moscow stock exchange below 60 and 63 rubles per dollar and Euro, respectively. At the same time before in all similar races the interest of the population to foreign exchange transactions increased sharply. Sberbank, VTB24, Bank “Otkrytie”, Alfa-Bank, Raiffeisenbank and other large credit institutions did not record increased demand for foreign currency from January 1st to 10th, have informed “news” in these banks.
— In the first days, we do not observe an excessive demand for currency. However, the demand for currency is, as in December. Traditionally, the dollars are more popular than the Euro, — said the head of the center for conversion operations of the Bank Stanislav Makarov.
In recent years, the change of course created the queues in exchange. And people wanted to the banks as in the strengthening and the weakening currency, which, according to experts, spoke of a General feeling of economic uncertainty in the environment.
— The last few years has shown that the demand for foreign currency among the citizens, as a rule, increases in conditions of a sharp weakening of the national currency, not strengthen it, says a leading analyst of Promsvyazbank Michael Poddubsky. Thus, it is not surprising that in the current environment there is no large-scale demand for foreign currency by natural persons, — he considers.
Especially actively bought up currency at the end of 2014 and beginning of 2015 after the Bank of Russia switched to a “free floating” of the ruble, which caused him serious weakening. At the same time active purchases of foreign currency by the population lead to increased pressure on the ruble. The dollar is traditionally a “reserve” currency that is purchased not for overseas travel and for protection against currency risks.
Head of Department of stock markets and financial engineering of the Russian Academy of national economy and public administration under the President (Ranepa), Konstantin Korischenko said that the population today is itself inert and is not quite logical from the point of view of financial common sense, selling dollars and euros on their decline and buying is on the rise.
Usually the currency buy or sell after five to seven days after the change of trend. The fact that psychologically to sell the asset, the price of which is growing, is quite difficult, as well as to purchase an asset that depreciates. Now the ruble is growing, — said the expert. According to him, technically it is very difficult to catch the moment of the trend reversal, besides in the ruble exchange rate dynamics the tipping point has not yet arrived, he said.
This behavior of Russians in General beneficial to the Bank, which is important to reduce the dollarization of the economy. Now the population seems to prefer to keep money in national currency, and those who have already purchased us dollars or euros, not in a hurry to take them at an unfavorable rate, expecting a strengthening of the dollar, suggests the head of Department of cash operations credit Bank of Moscow Olga Ermakova. High interest rates on ruble deposits in banks also contribute to the attractiveness of savings in domestic currency. The average rate on deposits in rubles now make up 8.4 percent on a currency — only 1-2%.
— Today’s behavior of citizens suggests growing confidence in the ruble, — the analyst of Bank “Russian capital” Anastasia Sosnova. — Contributed to the output of the economy on the path of recovery growth, lower inflation and a stable exchange rate in the second half of 2016.
According to the Director of the Department of financial markets operations of the Bank “Russian standard” Maxim Tymoshenko, now fluctuations within 1-1,5 ruble has no impact on the dramatic change in the structure of demand for foreign currency.
However, during the Christmas holidays foreign exchange transactions still occur. Most people spending money abroad on cards or sold the remains from traveling to banks already at home. In VTB “Izvestiya” reported that during the holidays (from 1 to 8 January) sold dollars and euros than buying. On working days (9-10 Jan), the demand for currency is not increased, with individuals actively sold dollars.