Important events of the day
China: producer price index in August – 04:30 Moscow time.
Russia: weekly inflation – 19:00 Moscow time.
USA: weekly change in oil reserves from API – 23:30 Moscow time.
The Eurozone: statements by ECB representatives.
In the spotlight
Negative sentiment prevailed on the global market on Tuesday. Investors played down the further escalation in the Middle East. Fears of a Fed rate hike continued to put pressure on trading platforms in the United States, which opened after the weekend on Monday. This is due not only to the conflict with Iran, but also to the still strong labor market in the United States, as Friday's data reminded bidders. The Russian market was able to grow moderately yesterday. Investors played off a number of geopolitical news, including the evening telephone conversation between the presidents of Russia and the United States. However, once again, the players might have overly optimistic hopes for an early de-escalation, and the lack of breakthrough news at the moment corrected the paper from local highs.
Today, global bidders will play off a new set of morning data from China. They showed slightly stronger than expected price pressures in the country. In Russia, Wednesday will be marked locally by the publication of the latest weekly inflation data before the Central Bank meeting and auctions at which the Ministry of Finance will offer two "fixes" – OFZ 26218 and 26230.
Oil and the ruble
Yesterday, oil prices updated the next local highs. Late in the evening, the United States launched a series of attacks on Iran's energy facilities, and later Iran retaliated. Against this background, Brent futures are trading at $99.5/bbl today. In the current conditions, the prospects are to see black gold above $100/bbl again for a while. they are becoming more and more real. At the same time, traditionally three-digit levels may prompt the US president to conduct verbal interventions to lower commodity prices.
The ruble began to weaken noticeably on Tuesday, but by the end of the day, the Russian currency strengthened significantly. In the afternoon, the exchange rate was supported by geopolitical news and a further increase in oil prices. It is also worth noting the continued decline in net open positions of individuals in currency futures. Today, the CNYRU exchange rate is at 12.78 rubles/yuan. Apparently, for now, volatility in the foreign exchange market will remain high, and the exchange rate may move in a wide range of 12.70-13.00 rubles/yuan.
Viktor Grigoriev, Chief Analyst at Bank Saint Petersburg.
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