Oil prices surged amid rising optimism about a trade deal between the US and China. The Brent quotes opened the day moving notably higher to the target of 65 dollars per barrel. The ruble is following the trajectory of oil and other currencies of the emerging markets. Positive background may lift the Russian currency to the highest levels.
Donald Trump’s comments have boosted market’s sentiment this week. Finally, traders have received the long-awaited news that the American president agreed not to impose additional tariffs on Chinese goods and confirmed the phase one deal with China. Easing of the trade tensions has supported the risk assets and put pressure on safe-haven assets. Early in the day, global oil prices have edged up by 0.70%.
Brent crude is trading today at 64 dollars 70 cents per barrel. West Texas Intermediate advanced to 59 dollars 48 cents a barrel. Market sentiment is getting more optimistic amid other political factors. Thus, judging by the UK general election results, Great Britain is very likely to leave the EU with a deal in January. So, the political uncertainty should ease significantly. This factor may provide additional support to oil prices which also depend on the global GDP dynamics. Overall positive background and the OPEC’s recent decision to deepen output cuts will enable oil quotes to hold above the mark of 64 dollars per barrel.
The ruble has significantly strengthened against the US dollar by the end of the year. The Russian currency is aimed at new highs after yesterday’s rally. The dollar/ruble pair is about to reach the levels of 62.25 or 61.85. Today, the meeting of the Bank of Russia will become a key event for the ruble. Investors expect the regulator to lower the key rate to 6.25% from 6.50%. However, the news from the UK and the trade deal front may offset the decision of the Central Bank of Russia. The ruble will continue to appreciate against the US dollar provided that Donald Trump and his team will not surprise the markets.
Existing optimis in the market may well continue till the end of December, creating favourable conditions for the ruble. The Russian currency has good chances to hold firmly near the current high levels.
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