Rates: CBR meeting is the main event
Yesterday, the overnight FX swap remained near the lower bound of the interest rate corridor at 7%, while the interbank rates and RUONIA were at 7.5-8.0%. Meanwhile, the NDF/XCCY rates adjusted upwards on the back of weaker RUB and possible reaction of the CBR to inflationary risks. The 3-month NDF rate closed at 8.35% and 2-year XCCY rate closed at 8.46%. Moreover, the CBR settled the 3-month 312-P auction and the volume of asset loans moved up to RUB 2.8tn, thus, about 60% of banks’ refinancing is done via asset loans. The liquidity environment is quite comfortable, as correspondent accounts moved up to RUB 1.0tn with the start of the new averaging period. Today is the CBR meeting and it is likely to be the major event for rates’ markets. Our base case is for a 50bp rate hike but recent comments by CBR officials about the potential drawbacks for growth suggest that the rhetoric could well be milder than previously.
Maxim Korovin, Anton Nikitin
VTB Capital analyst
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