GBP/RUB Outlook:
Slightly positive, but likely to move sideways, as the rate is just above its recent average and lacks a strong driver.
Key drivers:
• Rate gap: The Bank of England maintained its rate, indicating a cautious approach compared to ongoing challenges for the Bank of Russia amidst external pressures.
• Risk/commodities: Oil prices are rising, currently at highs, potentially benefiting the RUB through increased export earnings even as sanctions impose significant challenges.
• One macro factor: The UK has shown retail sales growth, yet high inflation presents a complex environment affecting the GBP outlook.
Range:
Expect GBP/RUB to drift within its recent range as external factors balance out.
What could change it:
• Upside risk: A significant recovery in UK economic indicators could strengthen the GBP.
• Downside risk: Further sanctions on Russian financial institutions may lead to increased volatility and weaken the RUB.