Moscow, 20 November 2014 Moscow Conference 1 Russian RUB FX spot & derivatives

markets in 2014


Dmitry Piskulov,

Ph.D. (econ.)
Chairman of NFEA Board;
Member of Monetary Policy Council
of Association of regional banks ”Russia”

depreciation against USD
CBR monetary policy: inflation targeting is fully in

force by 2015. BKT-RUB corridor abandoned
CBR increased Key rate from 5.5 to 9.5% - higher RUB %%
High capital outflow in the country: $120 bln. est. in 2014
RUB FX market volumes generally in decline
Declining RUB liquidity and volumes in domestic MM
Looming Banking crisis (capital adequacy down)
New refinancing from the CB: ccy repo,reverse FX swap
9. RUB increased use in CIS (prospects in BRICS)

Moscow, 20 November 2014

Moscow Conference

(reduction of import)
Government budget fulfilled because of increased energy export

revenues in Ruble terms
Sanctions bad = sanctions good : create incentives for replacing import with local productions
Facing eastwards: stronger ties with Asian partners (China, Vietnam, Hong Kong, North Korea) – may use Ruble as foreign trade payment currency

Moscow, 20 November 2014

Moscow Conference

volumes of RUB on-shore FX due to lower interbank trading,

lower energy prices
Off-shore (London) RUB volumes fluctuate:
Increased in April 2014
But may go down again in Oct 2014
Increased volatility looming after 2015

Draft Federal Law on regulation of retail Forex dealers (brokers) should pass second reading at State Duma – may potentially result in increased client FX flows to banks, require banks to create FX dealer subs

Moscow, 20 November 2014

Moscow Conference

market in 1986-2013
Moscow, 20 November 2014
Moscow Conference

November 2014
Moscow Conference

in global FX
Moscow Conference
Moscow, 20

November 2014

20 Nov 2014

markets 2014
In 2013 CBR stopped provision of monthly statistics of

volumes of FX and IR instruments, resumed in 2014 on short-tailed basis

Moscow, 20 Nov 2014

November 2014
Moscow Conference

FX spot market volumes (ADT) 2008-2014














Source: CBR, Moscow Exchange,

NFEA

2014

Conference

instruments: $ 28-30 bln.
Money market instruments: $ 1.0-2.0

bln.
Interest rate derivatives: $ 0.3-0.5 bln.
RUB bonds trading: $ 1-2 bln.
Total (FX,MM,Derivat.): $30 - 35 bln. daily

Moscow, 20 Nov 2014

of England UK FXJSC: ADT in 2009-14

Ruble settlements for export
24 April: meeting at First Vice-premier I.Shuvalov:

MinFin and MinEconomy were tasked to elaborate measures to increase Ruble payments avoid use of USD in export
May: V.Putin adopted legislation enabling Russian exporters receive Rubles as export proceeds.
August: Gazpromneft pioneer contract in Rub
September: I.Shuvalov “We need to reduce USD payments with Asia. New export contracts should be in Rubles”
THIS MAY INCREASE FX MARKET
TURNOVER in long-run

Moscow, 20 November 2014

Moscow Conference

Membership: institutional (local and global banks and brokers) operating in

Russian spot/forward foreign exchange , money markets and derivatives;
Management: the Board (28 market practitioners), 4 co-chairmen, 3 Committees (on Market Indices; for Professionalism, Ethics & Education; on Legal Affairs)
Projects up to date:
1999-2001, 2006: Elaboration of Standards (Code of Conduct and Rules to Conduct Operations (Committee for Professionalism, Ethics & Education),
Market indices: MosPrime Rate (2005, RUB money market reference rate), NFEA FX SWAP RATE – new index for USD/RUB and EUR/RUB forwards
Standard Documentation for Russian OTC derivative transactions (Russian ISDA Agreement) – completed in 2009, new version in 2011 (approved FFMS)
RUONIA – Russian analogue of EONIA, SONIA (since Sept 2010)
ROISFIX – OIS interest rates index (since April 2012)
CLS Bank: inclusion of Rub into CLS clearable currencies (since end 2011)

NFEA will merge with NSMA by end of 2015

125009, Russia,
Tel.+7 (495) 629-9510, 629-9709
www.nva.ru, www.nfea.ru; www.ruonia.ru



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