Despite the fact that Minister of Foreign Affairs Dmitry Kuleba said in advance that his expectations are restrained.
The experience of negotiations between the delegations of Russia and Ukraine shows us that both sides are currently insisting on their own and progress in resolving the conflict is still standing and is unlikely to move in the near future. In this regard, I do not expect a further downtrend of the USD/RUB pair.
The price of WTI oil also reacted to the beginning of the negotiations, which yesterday, on March 9, fell by 12.14% from $129 per barrel to $108 per barrel, today it is already trading at the 2011 high of $113 per barrel.
Gold also reacted to the beginning of the negotiations, the price of the precious metal yesterday fell by 2.87% from $2059 per ounce to $1991. As long as the conflict, in which the whole world is indirectly drawn in, continues, the prices of raw materials will rise, especially the price of gold.
Gold may regain its safe-haven status for investors, not only amid conflict but also amid soaring inflation. This cup and handle pattern on a monthly Gold chart suggests that the $2500 estimates are most likely to be achieved.
For Russia, it will be important not only to provide the domestic market with food but also to countries that support Russia in conducting the “special operation” in Ukraine. Turkey is one of the world’s top exporters of wheat flour, and Turkey buys wheat mainly from Russia and Ukraine, so losing export capabilities means losing grasp for Russia.
The pressure on Russia will continue, although it seems that all possible sanctions have been adopted, and now everything should gradually improve, but everything is not so. The West will now wait for the impact of these sanctions on the Russian economy, therefore, in the next month or two, this is still very optimistic, the parties will still insist on their own.
The dollar exchange rate, at the time of this writing, is traded on world markets in near 126.5.
The market is waiting for official statements by ministers Lavrov and Kuleba after the talks. I assume that both sides admit that no agreements have been reached, but there are some positive notes, which does not quite suit the market and the Russian ruble at the moment. In this regard, I believe that by the end of this week the dollar will return to 130, and at the beginning of next week we will again see the growth of the dollar to 150 rubles.
This article was originally posted on FX Empire