Summer reversal: how deep will the ruble fall in the third quarter
The Russian foreign exchange market ended the last quarter with a rather volatile movement. If since the beginning of April there has been a steady and systematic strengthening of the ruble, then since the second half of June the vector has changed to the opposite. By July 1, 2026, the official dollar exchange rate set by the Central Bank exceeded 78 rubles, and the euro approached 89 rubles. The Chinese yuan also regained its spring losses, rising to 11.48 rubles by the beginning of July. A week later, the weakening trend of the ruble only consolidated: on July 7, the Central Bank set the dollar exchange rate at 77.96 rubles, and the yuan was trading near 11.45 rubles. What caused this reversal, what macroeconomic factors put pressure on the domestic currency in the spring and how the situation on the foreign exchange market will develop in the next quarter — in the Izvestia article.
Hard Central Bank and geopolitics
The strengthening of the ruble, which was observed in April and May, when the dollar dropped to 70 rubles and the yuan tested the 10.5 ruble mark, was dictated by a powerful combination of external and internal factors. Geopolitics has become the main driver. The war in Iran and the closure of the Strait of Hormuz have inflated global oil prices.
And expensive oil traditionally supports the Russian currency. When Brent quotes exceeded $90 per barrel, Russian exporters recorded high dollar earnings, which they were required to sell on the domestic market according to currency control regulations.
Domestically, the ruble was supported by the tight monetary policy of the Bank of Russia. The high key interest rate (which the Central Bank kept at 14.5% in early summer, despite calls for easing) made ruble—denominated assets — primarily deposits and bonds - attractive for savings.
As Natalia Pyrieva, head of the analytical department at Cifra Broker, notes, the regulator's harsh rhetoric continues to help the ruble.
"High rates in the economy create both a high attractiveness of ruble assets and low economic activity, which constrains demand for foreign currency for imports," the expert explains.
Oil down, imports up
The situation changed dramatically in the second half of June, when the Iranian crisis began to subside. Successful negotiations between the United States and Iran on lifting the naval blockade and the free passage of tankers through the Strait of Hormuz have led to a sharp drop in oil prices. The behavior of world oil prices is the most significant factor determining the dynamics of the dollar against the ruble this summer.
"In early July, the price of Russian Urals export grade in western ports fell to $42 per barrel, which is almost half of the prices of April—May," Finam analyst Alexander Potavin cites statistics.
It is worth noting that oil taxes in Russia are calculated with a time lag, and the fall in cost in July will affect the country's budget in August.
"The decline in oil prices due to a drop in export earnings means a fundamental negative for the ruble exchange rate," the expert says.
The drop in export earnings coincided with a seasonal factor. Summer is a traditional holiday period, when the demand for foreign currency from the population traveling abroad increases sharply. In addition, importers are stepping up purchases of goods before the autumn season, which also increases pressure on the national currency.
Another nuance lies in the market's expectations regarding monetary policy. Despite the high base rate, the bond market has already begun to plan for future easing. Pavel Biryukov, Chief Economist at Gazprombank, draws attention to this mechanism.
— Do not forget about the impact of the implemented easing of the PREP: if at the beginning of the year the spread between the yields of AAA tier corporate bonds for a period of two years was 9.1 percentage points, now it has shrunk to 8 points, — explains the specialist.
The compression of the spread changes the distribution of liquidity between ruble and quasi-currency instruments, putting pressure on the exchange rate.
Moderate weakening
Assessing the prospects for the next quarter, analysts agree that the era of a strong ruble has remained in the spring months. The baseline scenario assumes a moderate weakening of the national currency under the pressure of a deteriorating trade balance.
Pavel Biryukov expects Russian oil export prices to stabilize in the range of $55-60 per barrel in the third quarter.
"On the supply side, the key factor will be a decrease in currency sales by exporters following a decrease in their foreign exchange earnings," he predicts.
The situation will be aggravated by a reduction in foreign exchange sales by the Central Bank: in the second half of the year, this figure will fall to 600 million rubles per day (after 4.6 billion rubles in the first half of the year). Gazprombank's baseline scenario assumes a weakening of the ruble to 80-84 rubles per dollar and 11.8–12.4 rubles per yuan by the end of September.
On the other hand, there are still factors stabilizing the ruble, such as the Central Bank's tough stance and tax payments.
— The budget deficit is in the focus of the Bank of Russia's attention. In a situation of an internal fuel crisis, prices for goods and services may rise again. For this reason, the key rate of the Central Bank of the Russian Federation may remain in place this summer — this is a good factor in supporting the ruble exchange rate," says Alexander Potavin.
He expects that in the next three months, the dollar will trade in the range of 76-82 rubles, and the yuan — 11.3–12 rubles.
Natalia Pyrieva from Digital Broker also sees the exchange rate in the range of 77-82 rubles per dollar by the end of September. She draws attention to local support factors.
— In July, the ruble is supported by the high tax season, when the income tax for the second quarter is added to the traditional taxes, for which significant payments will be made taking into account high oil prices in the past quarter, — the expert notes.
Thus, the Russian foreign exchange market is entering a phase of adaptation to new, more complex export realities. The Iranian premium in oil prices has gone away, exposing the fundamental dependence of the ruble on the volume of currency inflows. If the global commodity market does not present new geopolitical surprises, the Russian currency will continue its smooth decline, balancing falling export earnings and high interest rates from the Central Bank, which is unlikely to decide on a radical policy easing in a situation of growing inflationary risks.
Переведено сервисом «Яндекс Переводчик»
