Yesterday, the overnight FX swap declined to 13.07% (-77bp) yesterday, with the weighted-average rate nudging down to 13.84%. Hence, banks left the CBR’s swap facility untapped, though borrowed RUB 84bn in the overnight repo window. The averaging period is approaching its end, but it looks as though banks feel comfortable with the current level of correspondent accounts (RUB 1.08tn), as they ignored yesterday’s 10-day Treasury deposit auction for RUB 100bn. Despite lower money market rates, the front end of the NDF/XCCY curve came under pressure, increasing 40-50bp. In particular, the 1M NDF rate moved up to 17.69% and the one-year tenor closed at 14.58%. As a result, the curve turned a bit more inverted with the 1s5s spread widening 30bp to -380bp. We think that the selling of short rates is reasonable at current levels. The spread of front-end NDF rates to the overnight FX swap looks excessive, especially given the stabilisation of the FX market, which gives the CBR room for more front-loaded rate cuts.