Central Bank Cut Interest Rate Ruble But Pound Sterling Break 1.48

Russia's central bank announced that the key interest rate will be cut 100 points to 14%, the US dollar against ruble will not rise or fall, from 61.356 to 60.845.

Some analysts said that because the rate cut was in line with expectations, there was no rise or fall.

Reuters earlier survey showed that most analysts expected the Russian central bank to cut interest rates, but it was surprised that the Central Bank of Russia lowered its interest rate by two percentage points at the end of January, but many people now accept the logic of interest rate cuts and see it as a clue to the central bank's future initiatives.

Nabi Ulin Aa, Russia's central bank governor, said that the ruble is currently undervalued by 10%, and that the first quarter of 2016 has shrunk.

The main factor affecting the rouble exchange rate is oil prices.

The interest rate cut is aimed at balancing the risks faced by the weak economy, and structural factors are still restricting economic growth.

Russia's central bank expects GDP growth to shrink by 3.5% to 4% in 2015, and the economy is expected to shrink by 1%-1.6% in 2016. Inflation is expected to fall to around 9% this year.

The next interest rate conference will be held in April 30th.

The pound fell sharply against the US dollar and fell to 1.48 barrier support, refreshing a five year low of 1.4788, after Carney, the governor of the Bank of England, said he was not in a hurry to raise interest rates.

Pressure, and the British election approaching, political risk pressure pound.

Carney pointed out that the UK is expected to return to inflation targets within two years, even though the UK inflation rate has dropped to 0.3% in January.

He also said that the central bank will raise interest rates in a limited margin in the next three years.

The postponement of the Bank of England's interest rate hike is the main reason for the low pound. Yesterday, the pound fell against the US dollar in the wake of rising non US currencies.

Besides being dragged down by the expected delay in raising interest rates, the pound is also affected by political risk.

As the election approaches, political factors will have a great impact on the pound.

Britain will hold a general election in May.

The result of the British election is still unknown, and the pound will continue to bear pressure before the result is clear.

Steven Barrow, a standard bank foreign exchange strategist, said that with the decline of the Bank of England's interest rate hike this year and the approaching of the May 7th general election, if the Bank of England lagged behind the fed in the pace of raising interest rates, and in view of the growth of the independent party force supporting the withdrawal of Europe and the current Prime Minister Cameron's promise to renew his term of office, a referendum on the return of Europe would be held. If the result of the two party coalition led to the British withdrawal from Europe, then the pound might fall below 1.40 dollars later this year.

After yesterday's adjustment, the rally was lifted on Friday, reaching a maximum of 99.74 during the day.

Although the US PPI data released in February were much lower than expected, it has dragged down the US dollar trend for a short time, but the impact on the US dollar trend will not last.

Whether the dollar can go up to another level depends on the Federal Reserve's monetary policy meeting next week.

Data show that the US PPI rate fell by 0.5% in February, an increase of 0.3% and a decrease of 0.8% in the previous year. The PPI rate decreased by 0.6% in February, and the expected value was flat.

In February, the core PPI monthly rate dropped by 0.5%, and the annual rate rose by 1%.

The US PPI accident rate fell unexpectedly in February, declining for the fourth consecutive month.

The inflationary pressure is still weak.

In the March 17-18 day policy meeting, the Fed will probably eliminate the word "patience".

However, Yellen, chairman of the Federal Reserve, stressed that even if the phrase "patience" was removed from the Fed's words, it would not mean an immediate increase in interest rates.

The Federal Reserve will announce the resolution at 2:00 a.m. Beijing time on March 19th and hold a press conference of the Federal Reserve chairman at 2:30.

Hilsenrath, a senior correspondent of the Federal Reserve news agency and Wall Street journal, said that if the Fed moves next week to remove the word "patience", it will open the door for discussions on raising interest rates at the June meeting.

Barclays Bank said it expected the fed to remove the "patience" statement at the Federal Open Market Committee meeting next week, but it would lower economic growth and inflation expectations, confirming the slowdown in US economic data.

The bank said that the chairman of the Federal Reserve, Yellen, may stress that although the cycle of raising interest rates depends on data performance, this should be a very slow process, because the outlook for inflation is sluggish and wage growth is weak.

In addition, it is important to note that next Sunday, the central bank will announce minutes of the meeting, while the SNB will announce interest rate resolutions, and the market expects the SNB to further cut interest rates.