Russia: a brief market watch

RUSSIA ECONOMICS - In Brief 09 Jul 2026 by Evgeny Gavrilenkov

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The FX market stayed volatile, with intraday swings of three to four rubles. Despite ongoing sell-offs in the securities market, the ruble gained slightly thanks to strong export earnings inflows. Adding to that, the CBR nearly halted its “mirroring” operations, i.e., buying hard currency, given that in 1H26 investments from the National Wealth Fund into the local economy were minimal. Things could shift in the coming weeks as Russia plans to import gasoline, potentially boosting FX demand. Financial markets have been struggling recently, with most assets under pressure amid rising geopolitical tensions. The 10Y OFZ yield climbed to nearly 17%, while equities hit 18-month lows. Minfin placed under R10 bln on the primary market last week and canceled this week’s auction. That move helped prices rebound slightly, but negative sentiment still dominated. It may take weeks for the bond market to recover if geopolitical risks ease, so near-term demand for OFZs looks slim. Equities kept sliding, with margin calls adding further damage. Gasoline and diesel prices are up about 14% YTD, with diesel jumping 3.4% w-o-w in the week ending June 6, and gasoline rising about 2.0%. This pushed weekly consumer inflation to 0.31%, with Rosstat attributing 0.26% to July and the rest to June. As of July 6, YTD inflation reached 4.49%, slightly higher than last year’s figure for the same day, leaving little chance of a near-term key rate cut.