The Russian ruble is expected to continue trading around 100 to the U.S. dollar in early 2025 and gradually weaken to 108 toward the end of the year, according to a Reuters poll of 10 economists on Friday.
The ruble fell to its lowest level in about two and a half years in November when the United States imposed new financial sanctions on Russia, but it has regained ground since then after the central bank intervened to sustain.
Most analysts believe that the 100 mark against the dollar is the new equilibrium level, as the situation of foreign commercial transactions, disruptive due to sanctions, stabilizes, while other factors will support the ruble.
Analysts note that the first quarter of the year is traditionally favorable for the ruble as imports, foreign travel and foreign debt payments decrease.
The ruble fell to 103.7 against the US dollar on Friday after the central bank announced it would withdraw some of its support for the currency in the first working week of 2025 after the New Year holidays.
Analysts predicted the central bank would keep its benchmark interest rate at 21% throughout the first half of 2025, after surprising markets on Dec. 20 by keeping rates unchanged.
“We believe the central bank will keep its key rate at 21% at the meeting on February 14. We believe lending will continue to slow down, which is in line with the regulator’s forecast for 2025,” said Mikhail Vasilyev of Sovcombank.
Russia’s central bank raised its benchmark rate to the highest level in more than 20 years as it seeks to curb inflation, which analysts forecast at 9.8% this year, and counter economic overheating as a result excessive government spending.
Analysts estimate that GDP growth will be 3.9% in 2024, which is slightly higher than their previous estimate of 3.8%. In 2025, economic growth is expected to slow sharply to 1.6% due to monetary tightening by the central bank.
Analysts expect inflation rates to fall to 6.6%, closer to the regulator’s 4% target, towards the end of next year, allowing the central bank to cut its benchmark rate to 18% in the fourth quarter of 2025.
