By this time the market will appreciate the scale, on the one hand, the decline in demand for oil due to quarantine measures, on the other – increase from 1 April oil production. If the transaction is OPEC+ is not resumed, the price of oil waiting for another period of decline, as a result, the maintenance of the ruble in the current range will rapidly Deplete the reserves of the Bank of Russia, said in a prepared by the Agency “the Forecast of the banking sector in 2020: spring fever”.
the ruble has experienced the most difficult week for the last four years
“the fact that in the case of long-term oil price at below $ 35 per barrel, the question may arise about the expediency of spending of reserves for the artificial maintenance of the exchange rate with the Bank of Russia, – explains, “RG”, managing Director on Bank ratings “Expert RA” Alexander Saraev. – So, if the situation is not stabiliziruemost in the next two months, we can see a deeper devaluation of the national currency. At least the Bank of Russia can reduce the point resistance to 80 rubles per dollar and the interventions, already defending the frontier.”
Since the beginning of last week, the Bank of Russia instead of foreign currency purchases in the budgetary rules holds their “proactive” sales shortfall of budget revenues due to the slump in oil prices below the “cutoff price” (42.4 percent). Despite the small volume of sales (3.6 billion rubles per day, which is equivalent to $ 1 billion per month), the exchange rate stabilized in the range of 70-75 rubles per dollar. On Friday, the bidding closed at 72,6 ruble.
As the experience of 2018, the Bank of Russia can permanently suspend operations with currency in the budgetary rules, delaying them to a later date. However, the volume of foreign exchange reservesd office of the Bank of Russia (they exceed 577 billion) is not pointing to the risks of their depletion.
According to “Expert RA”, the rejection of foreign exchange intervention against the background of weak (below 35 dollars per barrel) oil prices, activates the conditions for the onset of the crisis scenario. In this case, inflation will exceed 7%, the Bank of Russia will be forced to raise its key interest rate above 9% and the economy for the year will be reduced by 1.5%.
However, the most probable (moderately negative) scenario, which is based on the Agency in its forecast assumes a decrease in average prices of Brent up to 40-45 dollars. per barrel, exceeding the inflation is 4%, the key interest rate by 1-1. 5 percentage points to the end of the year and a slowdown to near-zero values.
the Cabinet will support industries that will suffer from the situation in the economy
the Bank of Russia presented a risk scenario last time in the fall of 2019. He came from the decline in oil prices to $ 25. per barrel in 2020, a GDP decline of 1.5-2 percentage points short-term rise in inflation to 6.5-8%. In this scenario, the Bank of Russia noted that sales of foreign currency in the framework of fiscal rules will mitigate the impact of low oil prices on the foreign exchange market and inflation.
“Expert RA” estimates the stability of the banking sector for the coming test of strength as higher than in the crises of 2008 and 2014, largely due to the scrubbing sector of the weak players, and increased concentration of the sector in the state-owned banks, which constitute the backbone of the banking system. “So with the threat of their financial situation Expert RA expects the allocation of additional resources to ensure smooth operation, – said in a forecast. – In addition, in our opinion, to support such a mogut count and the largest private banks that are either systemically important or socially significant from the point of view of the high share in liabilities of individuals and small and medium business”.
According to the forecast “Expert RA”, the banks ‘ profit before tax by the end of 2020 will decrease by 20-25% in comparison with last year, to 1.2-1.3 trillion rubles (against 1.6 trillion excluding the impact of IFRS 9 in 2019). Considerable pressure on the financial performance of the sector, according to Agency estimates, will have a deceleration in the segments of car loans and unsecured retail amid growth of prices for cars and banks tightening their credit policies.