USD/RUB eases towards 102.00 even as US anticipates Russian hardships, oil retreat

• USD/RUB fades rebound from three-week low, pressured around intraday low of late.
• US anticipates Russia’s economic, military weakness after the war with Ukraine, also hints at dearth and inaccuracy of Moscow’s missiles.
• NATO offers four battle guards to Ukraine for defense, Western leaders eye more steps to sanction Russia.
• Australia, Japan join the West but China remains supportive of Moscow.

USD/RUB pares the biggest daily gains in two weeks around 102.50 during Friday’s Asian session.

The Russian ruble (RUB) pair bounced off the lowest levels since March 01 the previous day as the US-led global alliances announced multiple measures to criticize Moscow’s invasion of Ukraine. Also favoring the USD/RUB rebound was a pullback in oil prices, Russia’s key earner, from a fortnight high.

Senior US Official was quoted by Reuters saying, “Russia will emerge from Ukraine conflict weaker militarily and politically.” On the same line was a news piece from Reuters suggesting a lack of accuracy in Russia’s precision missiles and a likely dearth of the same in recent days. Furthermore, Australia and Japan also joined the West in sanctioning Russia.

On Thursday, US President Joe Biden pushed the European leader, the Group of Seven (G7) and North Atlantic Treaty Organization (NATO) members to announce more sanctions on Russia for its invasion of Ukraine. While his NATO friends could arrange battles guards for four of the Ukrainian cities and criticized Beijing’s ties with Moscow, the rest mostly refrained from major punitive actions against Russia.

That said, WTI crude oil prices took a U-turn from $116.61 the previous day, up 0.50% around $111.75 by the press time, as firmer US Dollar and Treasury yields weighed on the oil prices. Also challenging the energy prices are covid fears from China and Europe, as well as concerns that supply crunch will fade soon.

Amid these plays, S&P 500 Futures drop 0.15% intraday to 4,506, consolidating the heaviest daily gains in a week, whereas the US 10-year Treasury yields retreat from the previous daily close around 2.37% at the latest. It’s worth noting, however, that Australia’s ASX 200 have so far managed to push back the bears but Japan’s Nikkei 225 prints 0.20% intraday losses by the press time.

Moving on, Eurogroup meeting and oil price moves may direct USD/RUB. Also important to watch is the Fedspeak and the second-tier US data.

Technical analysis

Unless crossing 21-DMA level surrounding 122.20, USD/RUB remains pressured towards the $100.00 threshold.