RBA Minutes Signal Australia Central Bank Remains Ready to Raise Interest Rates if Inflation Persists 
Trump’s "Shock and Awe" Agenda: Executive Orders from Day One 
RBI Hits Pause as Geopolitical Storm Clouds Gather 
China's Refining Industry Faces Major Shakeup Amid Challenges 
BOJ Signals More Rate Hikes as Inflation Risks Rise Amid Energy Price Pressures 
Mexico's Undervalued Equity Market Offers Long-Term Investment Potential 
BOJ Rate Hike Expectations Rise as Weak Yen and Strong U.S. Jobs Data Increase Pressure 
Stock Futures Dip as Investors Await Key Payrolls Data 
Japan Signals Surprise Yen Intervention Strategy as BOJ Hawkish Stance Puts FX Traders on Alert 
Taiwan Central Bank Likely to Keep Interest Rates Unchanged Through 2027 
Fed May Resume Rate Hikes: BofA Analysts Outline Key Scenarios 
UBS Predicts Potential Fed Rate Cut Amid Strong US Economic Data 
BoE Policymaker Alan Taylor Signals No Need for Interest Rate Hike Amid Iran War Inflation Risks 
Moody's Upgrades Argentina's Credit Rating Amid Economic Reforms 
Lithium Market Poised for Recovery Amid Supply Cuts and Rising Demand 
Supreme Court Backs Lisa Cook, Defends Federal Reserve Independence Against Trump Firing Attempt 
The ruble has been the top performer among EM currencies over the past month, which is surprising given the lingering oil price and sanction risks weighing against it. A further rate hike by CBR today could further bolster this performance in the near-term. The median consensus expects no change in rate at today’s meeting. But a non-trivial proportion of analysts do expect a 25bps hike – we fall in this camp.
We could foresee three major drivers predominantly for a rate hike:
1) Potential ruble weakness/volatility if the oil price fails to move higher even after OPEC production cuts.
2) High likelihood of fresh sanctions in the new year which could rock the currency.
3) Pre-empting an assumed Fed rate hike in December. Top this off with CBR governor Nabiullina's remark – that the market should not anxiously scrutinise every small rate step as these are unlikely to have any effect on the economy – and these make a 25bps rate hike likely today. This should be the last one in this cycle and the next move in rates could be down. The above reasons are not very strong because growth in Russia is quite anaemic and inflation below target – there is no strong reason why CBR should be so anxious about every little ruble volatility either.
Trade tips: At spot reference: 66.495 levels, 2m USDRUB 1x1 put spread (67.057/64.14) is advocated. Courtesy: Commerzbank
Currency Strength Index: FxWirePro's hourly USD spot index is inching towards 140 levels (which is bullish), while articulating (at 12:08 GMT).
For more details on the index, please refer below weblink: http://www.fxwirepro.com/currencyindex
