USD/RUB extends the leg lower, meets support near 65.00

• The pair fades the recent up move to the 66.00 region.
• Positive Russian data gave legs to RUB.
• Rally in Brent prices is also helping the Ruble.

After bottoming out in the 65.00 neighbourhood earlier in the session, USD/RUB has met some dip buyers and moves to the 65.30 area.

USD/RUB looks to data, crude oil

RUB has been trading on a firm note since the start of the week, dragging spot lower for the third session in row today albeit meeting strong support in the 65.00 area for the time being.

RUB gains traction on the back of the rally in prices of the European reference Brent crude, which is approaching the psychological $70.00 mark per barrel amidst an improved sentiment in the risk-associated space, while the lower buck is also collaborating with the downside.

In addition, recently published GDP figures showed the Russian economy expanded at an annualized 2.7% during Q4 and the manufacturing PMI ticked higher to 52.8 during last month.

What to look for around RUB

The ongoing down trend in inflation plus the economy expanding above estimates could not only prevent the CBR from hiking rates further this year but it could also spark an easing cycle starting as early as this year, according to the latest statement from the central bank. In the meantime, the carry-trade remains supportive of RUB along with expected higher oil prices (despite RUB seems to have decoupled from oil dynamics as of late). On the negative side, the spectre of further sanctions on Russian citizens or the economy as well as geopolitical jitters carries the potential to undermine occasional upside momentum in RUB.

USD/RUB levels to watch

At the moment the pair is losing 0.10% at 65.30 and a break below 64.89 (21-day SMA) would aim for 63.61 (2019 low Mar.21) and finally 62.85 (200-week SMA). On the other hand, immediate hurdle aligns at 65.84 (high Apr.1) seconded by 65.34 (21-day SMA) and then 66.29 (100-day SMA) and then 66.50 (high Mar.8).