BofA recommends investors prepare to purchase Russian ruble, OFZ

MOSCOW, Aug 4 (PRIME) -- Bank of America (BofA) has recommended buying the Russian ruble and government OFZ bonds during seasonal contraction of quotations, BofA said in a research note seen by PRIME on Thursday.

The negative seasonal factors for the ruble – the oil prices and the balance of payments – may reach their peak influence in the third or fourth week of August, and the ruble will stabilize during the period while support of OFZ will remain, the bank said.

The current oil price fall is also determined by seasonal factors, while oil-dependent currencies and credit spreads are following its dynamics. BofA expects the Brent oil price to rise to U.S. $52 per barrel by the end of the year and to $55 in January–March 2017.

But the Russian central bank will soften its monetary policy in a slower way than was expected before. Russia’s inflation will slow down, and the central bank’s real key rate will reach 4% in 2017, which is rather high given the current negative yields in the world, the bank said.

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