The Russian ruble and nine other emerging market currencies may be affected by the Yuan devaluation because of the close trade relations with China, predict the Morgan Stanley analysts (NYSE: MS).
"The main victims of monetary policy in China could become the currencies of countries with a high share of exports to China, as well as countries that compete with China for export markets”, - said the head of global currency strategy at Morgan Stanley in London, Hans Redeker, whose words are quoted by Bloomberg.
Together with the ruble in this group there are included the South African rand, the Brazilian real, Thai baht, Singapore and Taiwan dollar, Chilean and Colombian peso, South Korean won and the Peruvian salt. For most of these countries, China is the main export market, says Bloomberg. For example, in 2014 China accounted for 37% of South Africa's exports and 30% of South Korean exports.
The main threat to the currencies of the “troubled ten” countries is now a global economic slowdown, according to Morgan Stanley. The International Monetary Fund expects the economic growth weakening in 2015 to the lowest level since 2009 (3.3%), despite record stimulus measures of central banks in Japan, Europe and the United States.
However, Rabobank analysts point out that the Central Bank of Russia will be extremely difficult to continue lowering the interest rate on the weakening of the ruble against euro and dollar.
"The risk of a prolonged recession in the Russian Federation is higher. With such a high level of uncertainty over China, the prospects of Russia are dismal" - quoted a Rabobank expert.
One of the most vulnerable emerging markets currencies against the dollar is the Turkish lira.
On Monday, the index of the 20 most actively traded currencies of emerging markets lost 0.3%. Last week, the indicator fell to the eighth week in a row, which is the most protracted period of decline since 1998. In 2015, the indicator has lost about 10%.
The ruble, during yesterday's trading, became cheaper by 0.5%, to 65.29 rubles per dollar.
The consensus forecast compiled by "Interfax" based on a survey of analysts of leading investment companies, banks, and analytical centers in the beginning of August, rose to 58 rubles for the dollar, from 55.4 rubles the previous survey. Ministry of Economic Development expects in 2015 averagely 60 rubles for a dollar.
The consensus forecast for the euro at the end of 2015 rose to 63.4 rubles from 59.1 rubles the previous survey.