Banking Expert Considers Reasons For Dollar Rate Decline Technical

The increase in the rates for ruble resources is due to a set of factors, an expert of Raiffeisenbank Austria Moscow pointed out in an interview with RBC. According to him, the balances at correspondent accounts have been rather low since the beginning of this month (they fell following the transfer of funds for participation in the 'sugar auction'), but nonetheless, there was still no client demand for rubles, and the rates on the inter-bank credit market were relatively low. As a result, nobody took these processes seriously, although the amount of money in the system was rather small, and exporters' activity decreased. The expert underlined that usually, the liquidity was restored through direct compulsory sales of foreign currency revenues to the Central Bank, but this time the volume of sales was low, and the dynamics of increase in the balances was very sluggish. Additionally, the expert remarked that October 15 is the date of profit tax payments, and after that, money goes from the market to the Federal Treasury. This factor had a major effect on the dynamics of rates yesterday. Moreover, a lot of funds were possibly transferred to deposits in the Central Bank, the expert believes. Accordingly, one can say that there is money on the market, but all of it is frozen in this way or another, and many banks have huge difficulties with liquidity, the expert of Raiffeisenbank Austria Moscow underscored. In his view, the Central Bank, which buys currency directly from banks and supplies rubles to the market, is the only source of liquidity now. Some state securities will be redeemed on October 17, which also supplies the market with funds. As a result, many traders are unwilling to sell foreign currency at a low rate, and the rate is not declining, the expert pointed out. A decrease in rates for ruble resources is likely on the market on October 17, and the dollar rate may return to the levels of 29.43-29.44 rubles per dollar.