Question of the day: what will the strengthening of the ruble end with?

As Novye Izvestia has already reported, the Central Bank of Russia has eased restrictions on foreign exchange transactions: from April 11, 2022, it has canceled the commission for the purchase of foreign currency through brokers, which was previously set at 12%.

Also, from April 11, 2022, the requirement for banks to limit the difference in the buying and selling rate of currency was canceled, with the exception of importing legal entities. The Central Bank recommends that banks set for importers who purchase foreign currency to pay for import contracts, the rate spread is not more than 2 rubles from the exchange rate.

It also became known that Russian citizens who had opened foreign currency accounts or deposits before March 9, 2022 and who have not yet chosen the established limit for receiving cash currency from their accounts, from April 11, 2022, will be able to receive not only dollars, but also euros in cash .

The total withdrawal limit remains - 10 thousand US dollars or their equivalent in euros and is valid until September 9th. Citizens will still be able to receive funds in excess of the limit from foreign currency accounts in rubles during the validity of the temporary order. Conversion, if necessary, is carried out at the bank's exchange rate, but the amount issued cannot be less than the amount calculated using the official exchange rate of the Bank of Russia on the day of issue.

In addition, from April 18, 2022, the Bank of Russia resumes the opportunity for banks to sell cash to citizens, but only that which has been received by banks since April 9, 2022.

A strong ruble will increase the country's competitiveness

Financial analysts assessed these measures differently. So, Pavel Spydel explains why the ruble has strengthened, and what to expect next:

“Stabilization of the excess current account surplus. Import of goods and services is the main item of capital outflow in Russia. In the current conditions, when 2/3 of imports are subject to restrictions, dispersal of imports from Asia, Turkey and South America can straighten out the trade balance and normalize the foreign exchange market, eliminate distortions. It is necessary to "pit" excess export earnings somewhere, and when a strict currency control regime is in place, imports are the only way out.

Almost 55% in the structure of retail sales (excluding food) are imported products and another 20% are localized in Russia, but are highly dependent on imported raw materials, components and equipment. The strengthening of the ruble has a strong deflationary effect, it will help stabilize overall inflation, which means lowering rates faster.

A strong ruble will make it possible to purchase imported means of production and equipment at minimal cost, which will increase the capital-labor ratio of industry and the ability for competitive production. However, this is true strictly up to a certain point - in the phase of purchases of means of production. In all other cases, this will simply undermine the domestic industry, because. It will be cheaper to import everything from Asia. Strategic competitiveness will definitely decrease and I have big doubts that it will be possible to find the same balance “on a fine line”.

This is a movement towards the normalization of the foreign exchange market

Moscow deputy Mikhail Timonov is sure that recently we have observed a curious economic experiment:

“What will happen if in a country that is a raw material exporter, the rate rises several times (up to 20%), the mandatory sale of 80% of the currency by exporters to the state is introduced, imports are almost completely stopped, and the sale of cash currency is prohibited.

The expected result was the strengthening of the non-currency ruble to a level below which the Ministry of Finance begins to experience difficulties with the usual fulfillment of social obligations at the expense of oil dollars, while at the same time leaving operations with cash currency on the black market, which is not controlled by the authorities and has a completely different exchange rate.

With the next shot, the Central Bank wants to kill three birds with one stone:

- to stop the creation of the black currency market that has begun;

- facilitate the fulfillment of social obligations at the expense of oil dollars, which should rise in price, albeit moderately, given the unprecedentedly low demand for foreign currency from importers;

- create conditions for lowering the Central Bank's rate (to 17% so far), since a high rate kills lending.

This is not yet the normalization of the foreign exchange market, but the movement in the direction of the market is indicated. Let's see how it works."

Now the ruble will ride a rollercoaster

On the contrary, experts of the 4BS|Economics, Business and Finance channel expect a new wave of ruble devaluation:

“So what everyone has been waiting for so long has happened: the Central Bank has canceled the “horse” commission for the purchase of dollars and euros. In recent days, we have often heard from our acquaintances how they would have bought dollars if it were not for the commission ...

So, we believe that demand will now outweigh supply - the ruble will begin to devalue after a long and hard correction. At the moment, USD/RUB reached the level of ₽71, but the prices did not go below, a major player held back the pressure of sellers.

Most likely, insiders bought heavily in the range of ₽71-75 and will ride the rollercoaster next week. Buying dollars or euros in the short term is a perfectly reasonable idea. The long-term outlook for these currency pairs is still murky.”

How to find out the real exchange rate of the ruble against the dollar?

Be that as it may, few people believe that today's ruble is really worth more than it was before the start of the special operation. One of the channels offered a funny way to find out its real price by offering to calculate it in Volkswagen Tiguans. So, in 2016, at a rate of 84, this car cost 1.4 million. Today, at a rate of 78, it costs 4.5 million. Thus, the real rate is about 240 rubles per dollar...