The first week of June brings notable shifts in currency dynamics and equity performance. The rouble has entered a correction phase against major foreign currencies, while oil and gold prices remain anchored amid ongoing geopolitical tensions.
Rouble Correction Underway
Yet the broader quarterly trend remains unfavourable for foreign currencies: the yuan has fallen nearly 10% over three months, while both the euro and US dollar have depreciated more sharply against the rouble. The persistent driver is export revenue flooding the market — not offset by sufficient import demand.
If import growth matched export expansion, exchange rate pressure would ease. That hasn’t occurred — though year-on-year import figures show resilience:
- January: $21.1 billion vs. $22.6 billion in 2024
- February: $24.8 billion vs. $20.7 billion in 2025
- March: $27.1 billion vs. $23.2 billion in 2024
Average Q1 2025 imports totalled $22.2 billion; Q1 2025 (current year) stands at $24.3 billion — a 9.5% average increase. March exports surged 40% month-on-month, while imports rose only 10%.
Key technical levels for the rouble:
- USD/RUB support now active at 68–70. A break below opens targets at 65, then 60.
- EUR/RUB support lies at 79–80. A breach could push the pair toward 72–73.
- CNY/RUB support is seen at 10.3–10.5.
The MOEX Index rebounded to 2570. Negative catalysts included the US decision to withdraw from the Russia-Ukraine negotiation track and escalation linked to strikes on Starobelsk. Near-term downside risk remains elevated, with potential movement toward 2520–2540 points, followed by a test of 2500.
Among sector indices, Chemicals & Petrochemicals fell sharply (-8.5% monthly). All constituents declined in May — including PhosAgro — with most losses concentrated in the final week, driven by dividend payout cancellations.
The Consumer sector (-5% monthly) and Construction sector (-5.6%) also underperformed. Notable declines were seen in Apteki 36 and 6, Evrotrans, Fix Price, Lenta, and WUSH (e-scooters). In contrast, X5 Retail Group (Pyaterochka, Perекrestок) and Inartika shares posted gains, recovering from March’s pullback. Within construction, Samolet and Etalon led the index lower.
Global News
No peace, no war: the Middle East situation remains volatile, with little prospect of a negotiated settlement before quarter-end. Oil prices hold just below $100/barrel — continuing to strain some producers. Discussions around freezing the so-called price cap on Russian oil have re-emerged. Gold trades near $4,500 per troy ounce. While forecasts remain positive, price action is muted — though YTD gains exceed 4%.
FAQ
Why is the rouble strengthening against major currencies?
Strong export earnings — especially from energy — are flooding the domestic market with foreign currency, while import demand remains insufficient to absorb the supply.
What are the key support levels for USD/RUB?
Immediate support is at 68–70; a break below opens targets at 65 and then 60.
Why did the Chemicals & Petrochemicals index fall 8.5% in May?
Mainly due to dividend cancellations across the sector, with most losses concentrated in the final week of the month.
