The latest forecasts regarding the tightening of the Fed's monetary policy indicate a unanimous opinion and the readiness of the regulator's members to strengthen the US currency in March. Despite the fact that the issue of inflation in the country is still relevant, since the target level of 2% has not been achieved, the head of the committee, Janet Yellen, and members of the Federal Reserve, it seems, will not hesitate on this issue.
Signals were also given to investors that the attractiveness of American assets was becoming a pressing issue for the regulator. This looks quite reasonable and within the framework of “Trumponomics” carried out by the new US President.
As analysts note, the decline despite general forecasts for March at the dollar exchange rate and the expectation of currency growth is most likely due to technical factors. Such a long growth over five days allowed many traders and speculators to win back future decisions of the Fed. Therefore, it's time to take profits.
The dollar will rise in March
In mid-March, according to the schedule of meetings of the US Federal Reserve, a meeting of the Open Market Committee will be held. Events can develop according to two scenarios.
But one should not expect strong growth since, according to many players, the main growth has already taken place and further strengthening may not be as significant as we would like. The past week showed that investors have already factored in a future event into the price of the USD.
If rates are not raised, this will be a serious blow to the dollar, and March 2017 may become the most negative for the American currency. The fall may be too strong and will weaken within a few months. The Fed's last meeting in February showed that committee members were largely spooked by Trump's policies and were hesitant to continue tightening monetary policy. If in March there are not enough votes to support the exchange rate, this will greatly disappoint market participants and lead to an outflow of capital from American assets, and not only from the US dollar.
We continue to publish currency exchange rate forecasts. This time we present the dollar exchange rate forecast for March 2017.
Dollar exchange rate in March 2017: influencing factors
Previously, the USD was completely dependent on the price of oil. When the cost of a barrel of oil began to decrease, the price of the dollar against the ruble went up. Now the financial market is restructuring to a new reality, which means a decrease in prices for “black gold” and, as a result, independence from it. It is this fact that is of primary importance for the Russian economy, and also affects the dollar-ruble ratio.
Currently, the cost of one barrel of oil has settled at 55 USD. This happened due to a decrease in the amount of extracted raw materials. Russian Federation cut production by 300,000 barrels.
At the same time, oil production from shale is increasing in the United States of America. According to analysts, in 2018 production will be the highest in the last 50 years.
The head of the Central Bank of Russia predicts a decrease in prices for “black gold”, which will lead to an increase in the USD exchange rate in 2017.
Foreign currency against the ruble in March 2017
As analysts predict, in the first spring month of 2017, the American currency will cost 61-65 rubles.
There are opinions that the currency will cost 58 domestic monetary units per USD.
The second scenario is realistic if the Russian Ministry of Finance continues ruble interventions (purchase and sale of domestic currency).
In general, according to forecasts for March 2017, we can conclude that the dollar exchange rate will be as follows:
- from March 1 - 65-67 RUB;
- from March 16 - 56-57 RUB.
The lowest exchange rate during March is expected to be at 55.3 USD against the ruble.
Experts believe that this month you can start shopping foreign currency. In the United States of America, there will be an increase in rates, which will lead to the stabilization of the American monetary unit in relation to other currencies.
The instability of today's economy is no secret from the civilian population, so popular unrest is fully justified: everyone's financial well-being depends on the situation in the Russian market.
What is the interaction between the ruble and world currencies today? Will it bring a new explosion in prices? Russian citizens anxiously view and listen to analysts' daily forecasts, as well as their predictions for the long term.
Leading experts from the Russian Ministry of Economy, on the eve of 2017, compiled a forecast of ruble-dollar relations for two years. Now analysts, based on predictions, correct the facts. So, for example, the March “readings” of the current year were located “in the corridor” - from 58 to 62 rubles per dollar.
Residents of Russia are wondering what will happen to the ruble exchange rate in March 2017? Is it necessary to accumulate funds in advance so as not to experience the difficulties of the foreign exchange market? But Russian experts are not yet talking about a big jump in the exchange rate, and, therefore, an increase in prices. They are reassured by the “big forecast” and recognize the impossibility of accurately predicting the situation, because so far no one knows how the conflict between Russia and Ukraine will be resolved and what sanctions will follow. If Russian state will not fail to enter into a militarized conflict, then the situation will stabilize a little: the country’s position in the political arena will change, and, therefore, there will be changes in economic situation. It’s no secret that economically Russia depends on other countries, which, due to the aforementioned conflict, began to reduce investments in our economy. The country's leadership was faced with the question of finding an internal “economic charge” that could bring relief.
If we still consider the experts’ forecast, they promise about 57 rubles per $1 in March.
Dollar exchange rate forecast for March 2017
According to the forecast, the dollar exchange rate has three points: the top – 62 rubles per dollar, the middle – 59, the bottom – 57. Analysts do not predict a strengthening of the ruble exchange rate, but another increase in the price per dollar.
This means that Russian citizens should expect a new increase in prices for all goods and a sharp decrease in income. Consequently, the population should now think about how to save their own financial situation in March next year.
It may happen that the country returns to its previous economic state, then the dollar exchange rate will decrease. If this does not happen, the devaluation will continue.
So Russians can only heed the advice of Alexei Mamontov and keep their money “in different stockings” and divide their savings into two parts. Leave one part in rubles, convert the second into dollars or euros.
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