The Russians were told what other factors put pressure on the ruble, in addition to geopolitics – Rosbalt

Geopolitics is now the most important factor for the Russian national currency, but there are other points that can create serious risks for the ruble. Sergey Suverov, the investment strategist of Arikapital Management Company, told about this in an interview with the PRIME agency.

At present, according to him, the Russian currency most sharply reacts to statements by Russian and Western officials regarding the situation around Ukraine and the development of relations that are still being built in the context of the Cold War.

At the same time, the expert pointed out, an important factor is the intention of the US Central Bank (Fed) to reduce the balance sheet and start raising interest rates, which can take an aggressive form, of course, if inflation does not slow down.

“Analysts are already expecting four to five increases in the US discount rate this year, which could increase the value of the dollar in the forex market and stimulate the inflow of speculative capital into the US currency from the assets of developing countries, including ruble assets,” Suverov explained.

In his opinion, the second factor, partly related to the first one, is the likely weakness in global stock markets, which reduces risk appetite in general. And, finally, the third factor is the growth in the supply of oil from OPEC +, which is increasing monthly by 400 barrels per day, although this quota has not yet been fully met.

In addition, the analyst drew attention to the fact that high inflation in Russia, which is double-digit for many commodity items, also undermines the purchasing power of the ruble and is a fundamental prerequisite for its weakening.

Meanwhile, the Russian ruble turned out to be the most undervalued currency in the world, based on the so-called “Big Mac Index”, RIA Novosti reports.

The Economist magazine has calculated this indicator twice a year since 1986. The indicator is based on the theory of purchasing power parity, which assumes that, in the long run, the exchange rate should equalize the cost of a basket of goods and services in different countries. The price of a Big Mac in different countries is taken as a basis. If it turns out to be higher than in the US, then the currency is considered overvalued, if it is lower, then vice versa.

Currently, a McDonald’s burger costs $5.81 (about 444 rubles) in the United States, and 135 rubles, or $1.77, in Russia. That is, the fair exchange rate of the Russian currency should be 23.24 rubles. per dollar – it turns out that it is immediately undervalued by 70%.

Moreover, among the currencies presented in the rating, the ruble took the last place. Previously, in January and July 2021, it was on the penultimate line, and the last was the Lebanese pound. This time, the penultimate place went to the Turkish lira, which is undervalued by 67.9%. At the same time, the euro was undervalued by 14.7%, the British pound – by 17.1%.