On Friday, RUB regained ground thanks to a recovering crude oil market amid a rather active trading session. Hence, MICEX reported USD 6.0bn in USDRUB turnover. RUB firmed 0.5% against USD to close at 56.13, but the session was volatile, with USDRUB swinging between 55.6 and 57.2. Meanwhile, Brent surged 1.9% on the day to USD 62.2/bbl, while the day’s lows were at USD 60/bbl. Global headlines took centre stage at the end of last week. The US jobs report for May was rather strong. Nonfarm payroll employment increased 280k in the month, compared with market expectations of an increase of 225k.
The unemployment rate edged up to 5.5%, from 5.4%, as the labour force increased 397k in the month after a 166k increase in April. The labour participation rate edged up to 62.9%, from 62.8%. Average earnings growth ticked up to 2.3%, from 2.2%, and hours worked increased to 103.3, from 103.0. In the aftermath of last Friday’s US jobs report, the probability of a Fed rate hike before September has increased. The 29 July FOMC meeting is in the frame. Meanwhile, Greece missed its payment of EUR 300mn to the IMF last Friday and looks to ‘bundle’ remaining payments amounting to about EUR 1.5bn on 30 June. The Athens equity index fell 5% and leading Greek bank stocks were down 10-15%. OPEC kept its 30mmb/d production target unchanged.
In light of this, EM FX weakened 0.6-0.7% against USD on Friday, with MXN and ZAR down 1.1% and 1.6%, respectively. In addition, NOK ended 2.4% in the red having shrugged off crude's bounce.