As fighting continues in Ukraine and oil prices rise, the ruble maintains a volatile position.
After a week of the ruble gaining leeway on USD and EUR, the Russian currency is falling in parallel to the collapsing ceasefire in Ukraine that started on Saturday midnight. In Debaltseve, fighting was intense in the power struggle over the city and government troops are finding themselves surrounded by Russia-backed separatists as the battles continue.
Last Friday 13 February, the peace talks between the leaders of Europe and Russia ended after 16 hours of negotiations and the markets reacted with huge confidence on the success. The major European indices climbed to 7 years+ highs on the ceasefire news; Tuesday tells a different story:
Europe50 [DJ EUROSTOXX50] surged to 2008 levels at 3463.50 on Friday; Monday closed down at 3401.50.
Germany30 [DAX] found Friday highs never seen on Metatrader4 before, rising to 11013.75; Monday closed at 10849.25.
The France40 [CAC] also climbed to 2008 positions of 4766 on Friday’s positive news but fell back to 4716.25 by close of trade on Monday.
Of course, other political pressures such as the apparent breakdown of the Greek bailout talks, and data reported last week demonstrating the growth currently being experienced by Germany, are also affecting the euro in a push-pull scenario on currencies and stocks.
Meanwhile in Russia, the slight rise in the price of oil may have had more impression. WTI currently stands at 53.95 on Tuesday as opposed to the 43.57 mark seen at the end of January. Oil-rich and commodity-dependent Russia needs this lift but the possibility of new EU and U.S sanctions following the breakdown of the Ukraine ceasefire may overwhelm any positive impact. USDRUB closed at 62.154 Monday with the ruble gaining from intraday lows of 61.014.
MT4 chart: USDRUB
MT4 chart: Europe50
MT4 chart: Germany30
MT4 chart: France40
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