CBR reserves plunged by 17.9 BN Usd last week, up til 5 Dec.
12 Bn Usd of those stemmed from capital outflows and the RUB weakened by 2 % against the basket(USD 0.55+Eur 0.45).
This morning the RUB weakened by another 1% vs the basket.
The country´s sovereign creditworthiness is now in focus as oil prices stay weak and outflows continue. S&P recently downgraded the country rating to BBB with a negative outlook.
With PM Putin on the barricades reiterating again and again that there will be no "sharp moves", the currency reserves dwindling (now at 437 BN Usd as of 5 Dec), and total sovereign and quasi sovereign external (hard currency) debt at 195 Bn Usd (as of 1 July), Q1 of next year may very well provide very sharp moves for the RUB. CEE will take its que from it. The Baltics even more so.
Monitor this one.
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