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For the first time since the beginning of March the dollar on the exchange fell below the level of 70 rubles./$. Last month, the U.S. currency fell by 5 RUB Rise of prices for European oil to $37-38 per barrel on expectations of recovery in demand, less severe than expected conflict between China and the United States supported the demand for risky assets. The expectation of further reduction in the key rate of the Bank of Russia adds to the attractiveness of the Russian currency.In the morning of 1 June the dollar on the Moscow stock exchange fell to 69,38 RUB/$, 76 kopecks below the close on Friday. So cheap American currency is not worth since March 6. For the month it fell by almost 5 RUB. To 15:00 the dollar remained near 69,6 RUB/$. The Euro has also updated a minimum from the beginning of March, reaching 77,25 RUB/€.According to Reuters, spot market quotes of European varieties of oil increased by 9-11%, also reaching its highest since March 6. So the Russian oil Urals has risen to $38.7 per barrel of North sea Brent oil to $37 per barrel. The cost of the derivatives contract on the Brent for execution in late June, is trading above $38 a barrel. As the economist of the “BCS Premier” Anton Pokatovich, investors “expect the improvement of the fundamental balance of the oil market as the recovery of world economic activity and, consequently, the gradual growth of oil demand in the third quarter.” The chief analyst of PSB Bogdan Zvarich indicates that this contributes to the expectation of an earlier meeting of the parties to the transaction OPEC+, which will discuss the extension of the current levels by reduction of production.In the framework of a market returning to risk (risk-on), we see that many emerging market currencies strengthened against the dollar, said Mr Pokatovich. Stronger (1%) increased in price against the dollar the Korean won and the Australian dollar. For the month, according to Bloomberg, among the top gainers against the us currency besides the ruble (+6,7%) were the Mexican peso (+11.5 percent) and African Rand (+7,5%). As stressed by Bogdan Zvarich, this strengthening occurs in the absence of tough measures by the US against China, which reduces the risk of failure of commercial transactions.In addition, the strengthening of the ruble supported by the Russian factors. The expected decrease of the key rate by 100 basis points at its June meeting, the Central Bank may not be the last this year, said Mr Pokatovich. This can lead “to a new round of price growth and, consequently, increase the influx of foreign investors in OFZ”.Analysts do not exclude a moderate strengthening of the Russian currency. According to Bogdan Zvarich, currently will increase “the likelihood of further decline of the dollar, and the goal may be the mark of 67.5 rubles./$. However, Anton Pokatovich thinks�� depreciation below 67-68 RUB/$ in the near future seems unlikely.Department Finansoviy day of trading oil in terms of the new agreement, OPEC+ to limit its production was not outstanding. Prices of different varieties was not significantly different from the values of the previous day’s close. A day off in most countries of Europe, protracted in time the effect of the transaction, as well as the lack of reductions on the background of a significant drop in demand for raw materials put pressure on prices. Nevertheless, market participants expect prices to recover to $30 per barrel by summer, and by the end of the year assessments increase to $40 and even exceed $50 per barrel.Read more