Yesterday, volatility on the Russian FX market increased markedly, with USDRUB swinging in the 55.70-56.30 range during the day. At the same time, trading activity moderated: MICEX reported only USD 3.8bn of turnover. In the morning, RUB opened weaker, but found firmer ground in the middle of the session, going for a moment below the 55.70 level. Later, the resumed correction on the oil market, coupled with hawkish geopolitical rhetoric at the G7 summit added a bitter tone to market sentiment, but in the late evening trade, RUB managed to find some support, finally closing at 56.00 (+0.2%) against USD. In turn, Brent surrendered 1.1%, edging down to USD 61.5/bbl.
The session in the EM FX universe was mixed. Asian currencies were on a softer footing, with IDR and KRW losing 0.7% and 1.1%, respectively. TRY came under pressure, plunging 3.3% against USD. On the other hand, BRL added 1.0%, followed by ZAR, which rose 0.8%. Commodity-based currencies enjoyed good appetite: NOK recovered 1.7%, NZD firmed 1.4%, and AUD closed 1.0% in the black.
Yesterday, the CBR conducted a 28-day FX repo auction, with USD 2.7bn on the offer. Banks borrowed USD 2.6bn at a 2.18% average rate, thus refinancing maturing funds.