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According to analysts from TD Securities, the Russian ruble could continue to be under pressure on the back of US sanctions to Russia. They consider USD/RUB could rise 10% from around 70.

Key Quotes: 

“The ruble is underperforming the dollar and other EM currencies for a second day in a row. Selling pressure has intensified today, however, as investors speculate that the US administration may sanction Russia over allegedly putting a bounty on US and UK troops deployed in Afghanistan.”

“The ruble selloff comes at a time of rising concerns over a second wave in the COVID-19 pandemic that may afflict several countries, including parts of the US. Also, the RUB seems exposed to intensifying headwinds from a possible failure of OPEC+ and Russia to negotiate an extension of oil output cuts.”

“We think RUB is likely to remain under pressure for now, idiosyncratically driven by sanction risks. As in the April 2018 episode, sanctions may weigh weakness up to a total 10% from a starting USDRUB level of around 70.”