The rouble crashed to an all-time low against USD


Sterling bounced slightly against the dollar on Friday as global markets rallied following international sanctions in response to Russia’s attempted conquest of Ukraine. Since then sanctions have been ramped up by the majority of nations in the eurozone including countries such as Switzerland who normally see themselves as neutral.

GBP/USD rate started the week positively recovering some of the losses from the previous week, but still faces downside risks from the ongoing Russian assault on Ukraine. However these risks could be neutralised if Russia does not capture its key targets quickly. The news suggest that the Russian troops are facing difficulties taking hold of Kyiv and other main cities.

GBP/USD could see some downward pressure alongside some other exchange rates after leaders of G7 countries announced what is quite possibly ‘the biggest sanction package’ on Saturday, which includes a decision to freeze the official reserve assets of the Central Bank of Russia (CBR).

Almost two thirds of Russia’s official reserves were reported to be held in G7 currencies and denominated assets, and any possible attempt to sell them before sanctions are implemented is another potential source of downside risk for GBP/USD this week.


The rouble crashed to an all-time low against the dollar yesterday as the sanctions started to bite the Russian economy. Western countries and their allies slapped Russia with new sanctions including cutting off some banks from the SWIFT financial network.

Russia and Ukraine held an initial round of talks overnight, five days after Russia invaded its neighbour, which appeared to have stabilised the market. But the news this morning confirms a forty miles long convoy of Russian armour is advancing on the Ukrainian capital. It had been expected that it would be a matter of days before the Russian army takes control of Kyiv. It has now been six days since Russia started the invasion and the capital is still under government control.

Elsewhere Atlanta Federal Reserve President Raphael Bostic said on Monday that he’s not ruling out a half point move from the Fed when they meet later this month, although he favours a quarter point increase, in the first comments by a Fed official since the conflict started. This could drive USD higher against its peers in preparation of the rate decision later in the month. All in all the market will continue to react in line with the development of the conflict and will remain highly volatile.


The pound advanced against the euro as geopolitics continued to weigh on the European currency. There are growing concerns after president Putin escalates the invasion by placing his nuclear deterrent on ‘special alert’. This coupled with the threat Russia could slow its energy supply to Europe could lead to stagflation. Slowing growth is unnerving investors in the bloc and will likely see EUR remaining under pressure.

Today’s data release includes final PMI reading for February for the eurozone where we expect a reading of 57.3, with any reading above 50 showing growth. We also have German Retail Sales and German inflation data, which is expected to rise back to 5.1% after falling to 4.9% in December.

Key announcements

08:15 – EUR – Eurozone Final CPI’s
08:50 – EUR – Euro PMI
15:00 – USD – US ISM manufacturing
18:30 – GBP – MPC Member Saunders speaks