The Russian rouble has been the best-performing of emerging market currencies in 2021 and is likely to get stronger in the near term but Russia’s economy as a whole is an unpredictable state and may run into trouble “any moment”, according to Moscow’s asset management boutique Matrix Capital.
Inflation is likely to close at 7.5 or 7.6 per cent by the year end, Matrix general partner Pavel Teplukhin told a news conference in Moscow, explaining that this forecast was based on an analysis of inflation dynamics for the past few months.
In explaining Matrix’s upbeat prediction for the rouble, Teplukhin cited the loosening of geopolitical tensions over the last few months, the Russian central bank’s tendency to raise the key rate and anticipated larger sales of Russian government bonds.
Yet the general status quo in Russia’s economy “is a reason for serious anxiety”, Teplukhin said. “Just as at war, fire may break out at any moment,” he said. “Inflation will reach new unpleasant peaks. This can be forecast for certain.”