Russia: a brief market watch

RUSSIA ECONOMICS - In Brief 02 Apr 2026 by Evgeny Gavrilenkov

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Volatility on the FX market increased dramatically in the past two weeks (10-day volatility jumped from 6-8% month ago to over 20% as of now). On the back of strong oil prices, investors anticipated Minfin to start purchasing FX on the open market in April, which could cause its deficit as exporters are expected to start receiving windfalls at the end of the month. The ruble temporarily weakened amid such expectations, and the USD/RUB briefly touched the 88 mark at the end of March. However, last week, the government announced that all its operations on the FX market could start no earlier than July. Generally, the situation on the FX market will largely be determined by exporters. The market expects exporters to keep selling some of their proceeds, which will be supportive of the ruble. Hence, the USD/RUB moved back to the 81-82 level and may stay here in the weeks to come. The sentiment on the OFZ market was mixed. On the one hand, the government decided not to change the cut-off oil price for the fiscal rule this year, which reduces the risk of additional supply of bonds. On the other hand, in recent weeks inflation accelerated to 0.17-0.19% w-o-w, causing concerns that CBR could be more cautious and won’t cut the key rate by more than 50 bps this month. At the same time, economic activity appeared poor in 2M26 as, according to Rosstat, the output of the five basic sectors, i.e., a monthly proxy for economic activity, contracted 2.8 y-o-y, prompting the CBR to soften monetary policy sooner. In our view, the CBR would prefer a more cautious and balanced approach and will cut the rate by 50 bps during the next BoD meeting. However, in June, it could take a more radica...