When conducting a survey of independent experts, it became clear that most people are concerned about the question of whether the dollar will fall. The interest of Russian residents is primarily due to the fact that it is the exchange rate of the American currency that determines the value of imports, and therefore the price of the vast majority of products. There is a very simple relationship. The high cost of black gold provides an influx of dollars into the domestic market, the ruble is actively strengthening, and residents can purchase goods at affordable prices. If the cost of oil falls, the picture becomes completely opposite, and the standard of living drops sharply.
Budget mismatch in 2015
Back in November 2014, it became quite obvious that the budget for 2015 was not close to reality. Costs were planned taking into account the fact that a barrel of black gold will cost at least $ 96 on the world market. Based on this indicator, the dollar exchange rate in banks during 2015 should not exceed 37 rubles. An unexpected surprise already took place in November 2014. By that time, the exchange rate of the American currency corresponded to 48 rubles. By mid-December of the same year, it had grown to 60 rubles. The peak was reached at almost 68 rubles. During the period of the New Year’s crisis, world experts did not dare to speak of a depreciation. Forecasts were concentrated around further growth of the currency. Some experts talked about reaching the mark of 100 rubles for one dollar. Not only the drop in oil, but also other basic factors became prerequisites for the negative development of events.
What does the budget deficit situation say?
Experts, given the budget deficit due to a decrease in foreign currency inflow due to falling oil prices, are talking about a possible, though not complete, recovery of the exchange rate. There are significant prerequisites for both a fall and a rise in the currency. Everything will depend on how the situation on the world oil market develops further. So far, we can say that in the near future the dollar in Russia will drop a little, which is directly related to the rehabilitation of the cost of black gold. While the largest oil producing countries are recovering their financial reserves after a massive drawdown, the dollar will decline. If today's exchange rate corresponds to 54.5 rubles per dollar, then we can count on a decrease to 46-48 rubles. Putting the situation on the price of oil, which is currently trading at 66.6 dollars per barrel with a strong uptrend, we can already say that the dollar will fall in the market. At the same time, an important meeting of OPEC member states will be held in June, at which decisions will be made that play an important role in pricing in the oil market and, consequently, affect the dollar exchange rate in Russia.
Ambiguous political situation
Information has repeatedly been heard in the world media that after the annexation of Crimea and the parallel confrontation in eastern Ukraine, sanctions were applied against Russia. They dramatically hit many sectors of the economy and left a negative imprint on the financial situation in the country. Oil production and the military industry suffered the most, revenues from which make up the bulk of the state budget and which supported the dollar in Russia at an optimal level. The main problem is the inability to take loans at Western financial institutions. Payment of payments on previously issued loans makes the government actively buy up dollars, which automatically leads to their appreciation.
What forecasts can be made by analyzing Russian policy?
To answer the question of whether the dollar will fall, based on the political situation in the country, is very problematic. Western states not only do not cancel sanctions against Russia, but also tighten places. The inability to take cheap foreign currency loans was supplemented by a massive departure of foreign investors from the country, which was accompanied by an outflow of foreign currency. Corruption and severe pressure from the authorities on business have caused the transfer of domestic business to offshore. All these facts indicate that the dollar exchange rate in banks will not radically change in the near future. Suppose it rolls back against the background of a slight increase in the cost of oil, but analysts do not recommend drastic changes until the conflict with both Ukraine and the countries of Europe and America is exhausted.
Forecast based on internal state phenomena
In addition to external factors, last year’s New Year’s crisis was also triggered by internal state problems. Over the past 15 years, the country has failed to change the raw material model of the economy to the modern one. The oil industry practically consumed all available resources, and the distribution of funds between the state economic segments was uneven. Excessive development of the oil industry has led to the decline of other economic areas. As a result, we could see a very high dollar. The forecast regarding the further appreciation of the American currency can be made on the basis of the fact that no one is carrying out structural reforms at the moment. Without a radical restructuring of the economy, the situation will not change, and therefore the ruble exchange rate will not be strong enough.
What makes prediction difficult?
The opinions of experts regarding the question of whether the dollar will fall, diverge almost dramatically. No one gives confident guarantees of the prospective movement of the currency. If at the end of 2014, most experts confidently proved the ruble’s hike to the mark of one hundred units for $ 1, today the opinion has changed. Analysts are inclined to believe that the dollar is falling and is confidently maintaining its trend. Difficulties in forecasting are caused by numerous speculative operations with the American currency, which in the conditions of its deficit in the country cause sharp fluctuations. The dynamics of the dollar also depends on the payment of debt by large Russian companies. For example, only in December last year and in January of this year, about 32-33 billion dollars of debt were repaid. The purchase of foreign currency at the interbank market leads to jumps in quotations and the hype of the population in the absence of compensation from the Central Bank.
Central Bank policy can determine the dollar
The decision of the Central Bank on injections into the international market influences a lot. Despite the fact that the Russian government released the national currency in free float, it reserved the right to adjust the value of the ruble in extreme situations. Given that Russia is one of the largest gold and foreign exchange reserves in the world, we can talk about the country's ability to restrain the national currency exactly as much as necessary. At any time, the Central Bank can adjust the dollar. If, within the framework of monetary policy, a printing press is launched and unjustified money production begins, the US currency will skyrocket, which threatens the devaluation of the ruble. If the flow of unjustified money will still be tightly controlled by the government, we can consider the prospect of a stronger ruble and a fall in the dollar.
Moderately optimistic forecasts
There are only three categories of forecasts. It is moderately optimistic, optimistic and pessimistic. Considering each of the options for events, we can talk about whether the dollar will fall. Moderate optimists rely on the powerful economy of Russia and the inability of Europe to develop without domestic energy sources. Analysts operate on the fact that low oil prices are unprofitable for the whole world, and soon the situation will stabilize both in the global oil market and in the Russian economy. They carefully study the dollar. Their forecast stops at a rate of 38-42 rubles by the end of 2015.
Optimistic views on the situation and the dollar
Inveterate optimists also say that the dollar is falling. These are mainly representatives of the government apparatus and people close to them. They consider not the actual situation, but political motives. Their opinion dwells on the fact that the drop in oil is the work of the American government and their partners. The opponent’s goal is military-political concessions from Russia. The pointlessness of such a development of events in the future should become clear by the end of the summer of 2015. According to forecasts, the country will celebrate the new 2016, while being in a pre-crisis state. It does not take into account only the fact that America itself suffers because of the fall in the cost of black gold in the world market, since shale oil is far from cheap to develop.
Pessimists - Most Analysts and Experts
The largest group of experts believes that the dollar, which the Central Bank is currently offering at the rate of 54.5, will never return to the pre-crisis course. Liberal-minded analysts point to the growth of the currency to the level of 100 rubles. The reasons for this they see the crisis of non-payments, the credit crisis and the bankruptcy of a large number of banks and enterprises. There is talk that Russia can turn in the direction of a command economy and even form an updated format of the USSR. The expectation of an incredibly deep crisis makes us beware of social upheaval and a parade of sovereignty.
It is worth indenting and attesting to the fact that not one of the serious forecasts made over the past six months has been justified by half. This gives good reason to believe that it is meaningless, or even more likely, to predict the direction of the dollar exchange rate does not make sense, since the direct relationship between the currency and economic indicators has long been broken.