Russian rouble soars to one-month high as oil prices halt slide

how to invest in the ruble

As we shared before, investors’ funds available in KZT are held with the servicer bank. At the moment, the correspondent bank of the Mintos servicer bank has made some adjustments to new market conditions. This is why for now, the KZT exchange will be available for undefined periods of time and under controlled conditions.

Is it a good idea to invest in rubles?

The Russian ruble has gained about 2.5% in the past month and is among the most undervalued emerging market currencies. It's worth considering charts on oil, COVID-19 and the economy before chasing the rally.

The only lending company on Mintos from Ukraine is obviously influenced by the state of emergency and martial law in the country. We will continue to be in close contact with lending companies how to invest in the ruble from Russia and Ukraine and share important updates on our blog. Lending companies from Russia are showing serious willingness to cover their due repayments to Mintos investors.

Investment Policy Hub

As a condition for granting permission, The Central Bank stipulated a maximum repayment of €10.4 million, or 65% of the lending company’s debt to investors on Mintos. Six months later and in line with the terms of its restructuring agreement, Revo Russia has repaid the agreed total of €10.4 million and we’re closing the case. Any remaining outstanding amounts were declared as bad debt as per Mintos classification, and Revo Russia has exited Mintos. Commodity producers in Australia, Canada, Latin America and South Africa stand to benefit from higher commodity prices and the loss in Russian supply to global markets. Morgan Research expects Asia and Middle East to provide better stability while Latin America should benefit from higher commodity prices. For Latin American corporates, the recent sell-off has created better entry points for certain credits such as those in financials, miners and oil and gas exporters.

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Morgan Research forecasts that Russia’s economy will contract 35% quarter-over-quarter and seasonally adjusted in the second quarter, and for the year experience a GDP contraction of at least 7%. Inflation could end the year at around 17%, up from 5.3% forecasted before the crisis, with risks skewed heavily to the upside due to ruble depreciation and import shortages. It has been agreed to exclude a number of Russian banks from the SWIFT system, however, details about which exactly Russian banks will be affected by this decision, or what will be considered as a breach of sanctions are still unknown. Together with lending companies we have identified a few different routes that Russian lending companies could use as alternatives to SWIFT (e.g. China’s alternative solution, other non-EU banks). We will be able to expand on this only after we know the full scale of the sanctions’ impact on the money transfers from Russia.

Inflation & Prices

Please, note that the exchange activity for the KZT on Mintos is enabled due to the current availability of this service by the servicer bank with which the available funds in KZT are held. Hence, it can be disabled at any moment, at the sole discretion of the bank. We communicate with the lending companies and banks on a daily basis, and we follow the news regarding this topic with heightened focus, as we are eager to stay on top of the developments which are very important for our daily business. We’re sharing the responses to our questions shared with Eco Finance in full.

how to invest in the ruble

What’s more, a payment that went through smoothly one time might not necessarily go through the same path next time. We’re providing our banks with all requested information as soon as possible to release the payments faster, but we’re not able to control the banks’ processes and work. We kindly ask you for understanding and patience as besides bringing devastating turmoil to the people of Ukraine, the war also resonates through financial markets and influences what we know as normal market conditions. But after month-end taxes were paid on April 28, the rouble can now count on reduced supply of foreign currency in the market. The sanctions the West has imposed on Russia have dealt a heavy blow to the ruble’s value and Russia’s financial system.

Most recent status of borrower repayments

Under the worst case scenario of a full ban, assuming the drag fell entirely in the first half of 2022, it would subtract 3% annualized from global GDP and add 4% annualized to the global consumer price index (CPI). Morgan’s Global Economics team, if this remains solely a negative supply shock and if the price of oil reaches $150, the hit to global GDP growth would be 1.6%-pt based on its general equilibrium model. Following yesterday’s update on the new FX account, we’re pleased to have received 10 million RUB from Revo, which was converted to around €143k. The agreement with the service provider of the RUB account is such that the money becomes accessible to us once it is converted to EUR at the offered rate. The rate will differ from the stated exchange rate of the Central Bank of Russia, which according to our knowledge, still does not reflect the actual market rate at which money can be exchanged.

  • As you’re aware, lending companies are directly or indirectly impacted by bans for sanctioned banks.
  • Also, delinquency in 1-60 DPD started to decrease in the total portfolio.
  • It has been agreed to exclude a number of Russian banks from the SWIFT system, however, details about which exactly Russian banks will be affected by this decision, or what will be considered as a breach of sanctions are still unknown.
  • In July, the company started to slowly roll out lending to new customers, with products and scoring methods adjusted to the new conditions, and in order to assess information about the market and clients in the current environment.

Currently, we do not observe significant deviations in clients’ payment discipline. The volume of incoming payments corresponds to the seasonality and restrained portfolio growth. Investors on Mintos as well as Mintos itself are directly affected by the sanctions on Russia and the Russian retaliation measures.

Global Equities

Domestic Russian banks, followed by European banks with local legal entities in Russia, are the most exposed to risk resulting from sanctions. With over 50,000 technologists across 21 Global Technology Centers, globally, we design, build and deploy technology that enable solutions that are transforming the financial services industry and beyond. At the time of writing this update, there were still no new information about which Russian banks will be disconnected from the SWIFT system. “Diplomatic decisions have brought SWIFT into efforts to bring this crisis to an end, and we will always comply with applicable sanctions laws.

how to invest in the ruble

But, once you have a full understanding of these ETFs, you can consider adding any or all to your portfolio. Profee allows you to hold balances in Russian Rubles (and Euro, Pounds sterling, and US Dollars). Top up each balance in seconds for free via bank transfer or with your VISA or Mastercard.

Opportunities and Risks of Forex Trading

Examples of such funds include the Merk Hard Currency Fund, Aberdeen Global Income Fund, and Templeton Global Bond Fund. The forex market operates between individuals represented by brokers, between brokers and banks, and between banks. Here are five ways for a retail investor to participate in this market.

Can I buy Russian ruble?

The clearest way to buy Russian rubles is to present foreign currency to banks, hotels, and exchange bureaus within Russian borders. This option is, of course, limited only to those who are eligible to enter the country.

Another option is to transfer money from your debit or credit card to a Visa or MasterCard that works in Russia. Ruble, also spelled rouble, the monetary unit of Russia (and the former Soviet Union) and Belarus (spelled rubel). This communication may not be redistributed or retransmitted, in whole or in part, or in any form or manner, without the express written consent of J.P. Receipt and review of this information constitutes your agreement not to redistribute or retransmit the contents and information contained in this communication without first obtaining express permission from an authorized officer of J.P. For comments and questions, please join the conversation in the Mintos Community. Mintos is a regulated entity with a developed contingency plan and sizeable cash reserves which allow us to plan and adjust our business according to the development of any situation.

Is it risky to invest in Russia?

While Russia offers high returns, it is dominated by energy companies, the state of regulation is still under development at best, and the political risks are greater than elsewhere. That's a striking feature of investing in Russia. The risks and potential rewards are both high.

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