The growth of the euro (2014) in Russia

During the first few months of 2014, the ruble weakened against the world's leading currencies, including the euro. How will the single European currency behave relative to Russia in the future? Should we expect that the euro will continue to grow? Everything depends on many factors of economic and political nature.

Regulator and corridor

What we see on the screens of the exchange of exchange offices is the result of currency trades conducted with the participation of the Central Bank. The value of the figures displayed is the sum of the impact of a large number of financial mechanisms, including those that are used by global economic institutions, including the Central Bank. One of the instruments of influence of the main bank of Russia on the market is an acceptable currency corridor. If the ruble exchange rate is significantly undervalued or overstated, the Central Bank starts buying or selling money to retain the required values. There is a currency intervention to prevent too much devaluation of the ruble.

After its volume exceeds 350 million dollars, the corridor within its borders is shifted up by 5 kopecks. Such actions of the Central Bank are common for the economy, but in the first months of 2014 such movements were mostly one-sided. The currency corridor shifted, signaling a stable weakening of the ruble. The figures are eloquent: in comparison with the values of the previous year, the rate of the Russian "wooden" in relation to the major world currencies fell by 10 percent. The forecast for the growth of the euro and the dollar is obvious.

Factor of economic growth

In recent years, the ruble, as a rule, moved up and down the currency scales in almost direct correlation with oil prices. Now, however, his course depends on other macro-indicators. First of all, this is as such an economic growth. Even though the price of a barrel of oil stably keeps at $ 100 or more, Russia's GDP is growing extremely slowly. The forecast for 2014 is an increase of about 1.5 percent, which is lower than the world average.

Low rates will inevitably affect the ruble exchange rate to leading currencies. The growth of the euro in 2014 in relation to the Russian banknotes, thus, may still amount to about 10 percent. At the same time, experts note that the practical importance of the ruble / euro exchange rate for ordinary Russian citizens is not high: the price of most goods is expressed in national currency. In contrast, for example, from the 90's, when the price tags in a large number of stores were in the "u. E. ". There is a possibility of a rise in price of only imported goods, but not more than the same 10 percent.

The authorities remain optimistic

The state represented by the Ministry of Finance, however, does not expect special problems from the marked reduction in the ruble's depreciation on the foreign exchange market in 2014. According to officials of this department, for serious fluctuations of the course there are no special economic reasons, and its possible values, one way or another, will remain within the corridor established by the Central Bank. At the same time, the Finance Ministry avoids talking about the prospects of the reverse trend: will not the growth of the euro and the dollar, but the strengthening of the ruble.

Some experts are sure that the Russian currency market has gained stability in recent years. In this regard, the Central Bank in 2015 plans to abandon the monitoring of the ruble and move to inflation targeting - the adaptation of the economy to the planned indicators of consumer price growth. In fact, this means releasing the national currency into "free floating", but taking into account the positive trends of recent years of its strong fluctuations, according to the expectations of the financiers, it should not happen.

Business is cautious

Unlike the moods prevailing in state institutions, private corporations, and especially banks, prefer not to be so optimistic. According to a number of specialists who are not related to the structures of the Ministry of Finance, the weakening of the ruble is a systemic phenomenon. It began not only just a few months ago. Oil prices meanwhile do not have a direct impact on the ruble exchange rate. Business in other: the demand for national currencies of developing states falls, and, conversely, there is an increase in the popularity of the dollar, the growth of the euro.

In Russia, by the way, the structure of most branches of the economy makes it possible to attribute the country to the marked type. This trend is global and is connected with the global crisis, after which developing economies are not developing very actively. In addition, the situation is complicated by the fact that investors, as soon as the market begins to "skip", immediately sell out rubles on the exchange. The rate of the Russian national currency, thereby, is affected by the psychological factor. Investors traditionally consider the ruble as unsustainable, and investments in it are risky.

But it is better to save in rubles

Despite the negative trends in the foreign exchange market, experts do not advise Russians to make savings in dollars and euros. The fact is that our banks still offer high rates for ruble deposits - about 10% per annum. With regard to foreign currencies such values have long been gone. If, for example, we admit that the ruble will depreciate even by another 10%, then the depositor will not lose anything. In connection with the current inflation indicators, such a deposit will in any case be a winning option for storing money.

A certain percentage of the amount of savings is also necessarily lost on conversion. However, this "mathematics" is not entirely justified if a person is going to go live abroad or receives a salary that depends on the exchange rate of foreign currencies. Given that there will be an increase in the euro, the 2014th year is seen as quite attractive for the accumulation of money in this currency with the aim of moving abroad.

Business - for the word Europeans

If the ruble depended largely on the policy of the national regulator - the Central Bank of Russia, then the growth of the euro, in turn, is largely determined by the work of the European Central Bank. Now this financial institution prefers a relatively soft approach to market regulation and does not gravitate toward unusual methods of influencing the euro. This policy is facilitated by some improvement in the economies of the Eurozone countries in early 2014. If this trend continues, the rate of the single currency vis-à-vis other world denominations will likely grow with a high probability.

Regarding the mutual location of the euro and the ruble, the US dollar will play a role here. The exchange rate of the Russian currency directly depends on the other two, currently more globally significant. It is unlikely that the euro / dollar exchange rate in 2014 will deviate significantly from the value of 1.4 points (the regulatory CB will not allow more violent fluctuations). Therefore, if the US currency reaches, for example, 36 rubles, then the European price will not exceed 50.

Forecasts

Some experts of the banking market expect the ruble to strengthen by the end of 2014, and therefore it is better for citizens not to get involved in the rush of buying dollars and euros. The reason for such obvious optimism is in the policy of the Central Bank. Negative trend, which accumulated in 2013, should, therefore, change its direction in mid-2014. Among the forecast figures - 33 rubles per dollar, 43.5 - for the euro. This is also due to macroeconomic factors: in the developed countries of the EU, the level of demand for goods produced in Russia is expected to grow, and the demand for oil will increase. However, the question of whether there will be a pronounced growth of the euro, the forecasts of 2014 do not affect.

There is also a version that in today's economic situation there is no need to devalue the ruble (as happened, for example, in 2008). Then there was a significant decline in GDP, unemployment increased sharply, and therefore devaluation became a saving straw for many sectors of the Russian economy (especially for export-oriented). In addition, experts believe, at that time the Central Bank spent about $ 200 billion on devaluation, and today it will be better to direct available funds for other purposes.

Geopolitics

As you know, "money likes silence". Therefore, any trends in the global economy are tied to events on the political plane. Today the central theme in the whole world is the situation around Ukraine. If the tension in the relationship between Russia, Europe and the United States falls, then the exchange rate of national currencies is expected to roll back to the values of January-February. At the same time, even in this case, it is not worth waiting for the strong appreciation of the ruble to world currencies, since, in addition to the factor of politics, the influence of economic trends remains significant, the dollar's position may strengthen and the euro grow. The year 2014 can largely determine the main vectors of geopolitics for the near future.

The main thing is that the market should move

The most unpleasant situation on any currency exchange is stagnation. Movement in the market, whether it is the growth of the euro or the cheapening of the ruble, give signals to investors to do something, make any decisions. However, as experts say, building long-term forecasts regarding exchange rates is a thankless task. There is a very high probability of not guessing the direction, much depends on the factors, the effect of which is very difficult to foresee. It is important that market participants also have access to reliable information about the processes taking place in the economy.