The Russian ruble surged against all major currencies on Wednesday, September 14, 2023, reaching its highest level in months. The ruble’s strength was attributed to a number of factors, including capital controls imposed by the Russian government and strong energy exports.
The US dollar also remained strong on Wednesday, with the US dollar index (DXY) rising above 109. The dollar’s strength was supported by expectations of further interest rate hikes by the US Federal Reserve.
Here is a summary of some of the key forex moves today:
- USD/RUB: The Russian ruble surged against the US dollar, with the USD/RUB pair falling by over 18% to 127.7425. This is the ruble’s strongest level against the dollar since February 2022.
- EUR/RUB: The euro also fell sharply against the ruble, with the EUR/RUB pair falling by over 17% to 142.299. This is the ruble’s strongest level against the euro since March 2022.
- USD/JPY: The US dollar remained strong against the Japanese yen, with the USD/JPY pair rising above 144. This is the highest level for the USD/JPY pair since August 1998.
- GBP/USD: The British pound fell against the US dollar, with the GBP/USD pair falling below 1.14. This is the lowest level for the GBP/USD pair since March 2020.
- EUR/USD: The euro also fell against the US dollar, with the EUR/USD pair falling below 0.99. This is the lowest level for the EUR/USD pair since July 2002.
Factors Driving Forex Moves Today
The Russian ruble’s strength is being driven by a number of factors, including:
- Capital controls: The Russian government imposed capital controls in February 2022 following the invasion of Ukraine. These capital controls have limited the ability of foreign investors to sell Russian assets.
- Strong energy exports: Russia is a major exporter of oil and gas. The high prices for energy exports have boosted the value of the ruble.
- Reduced imports: Russia’s imports have fallen sharply since the invasion of Ukraine. This has also helped to support the value of the ruble.
The US dollar’s strength is being driven by expectations of further interest rate hikes by the US Federal Reserve. The Fed is expected to raise interest rates by 75 basis points at its next meeting in September. Higher interest rates make the US dollar more attractive to investors.
Outlook for Forex Markets
The Russian ruble is expected to remain strong in the near term, supported by capital controls and strong energy exports. However, the ruble could come under pressure if the war in Ukraine escalates or if the Russian economy weakens significantly.
The US dollar is also expected to remain strong in the near term, supported by expectations of further interest rate hikes by the Fed. However, the dollar could weaken if the US economy slows down or if the Fed signals a more dovish stance.
Overall, the forex markets are likely to remain volatile in the near term as investors continue to assess the risks associated with the war in Ukraine and the global economic slowdown.