The Russian stockmarket remained depressed in December amidst continuing volatility and against a backdrop of currency devaluation. The Magna Russia Fund fell 13.5%, broadly in line with underlying markets.
The Russian authorities continue to manage the rouble down in a controlled fashion despite calls for a one-off devaluation. By skilfully widening the corridor within which the rouble can trade against its euro dollar basket at opportune moments, they have attempted to minimise their recourse to foreign exchange reserves and to maintain the population’s faith in the banking system. The rouble has now
fallen by more than 20% against the US dollar since the middle of last year, falling by around 8% in December alone. Although those Russian companies without US dollar or other foreign earnings have come under some downward pressure as a result of the weaker rouble, the market as a whole is beginning to benefit from the perception that order is being restored to financial markets that have been painfully disorderly for many months.
Charlemagne monthly report: Russia 12/2008
No comments:
Post a Comment