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Commodity currencies have experienced a recovery in the last day, with the Russian ruble (RUB) as the best example. Danske Bank is expecting Central and Eastern Europe (CEE) currencies to advance.

Key quotes

“The recent sell-off of the RUB stands out as having been the last currency to be negatively affected and one of the first to rally strongly. In our view, this is a testament to the fundamental strength of the Russian economy, prospects of fiscal expansion and carry attractiveness, which is also likely to continue in the months ahead.”

“Some short-term relief is probably CNH/JPY friendly if signals of policy easing make markets expect the Chinese economy to recover faster than they are currently projecting and commodities to bounce back slightly.”