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3 Mar 2014
Flash: HUF, RUB, PLN and TRY under pressure - Societe Generale
FXStreet (Barcelona) - Kit Juckes, Global Head of Currency Strategy at Societe Generale, argues the Crimean situation would put EM currencies to the test.
Key Quotes
"The Crimean reaction to the ousting of the Ukrainian government, the Russian response and the counter-response from the US/Europe, are the focus for markets. The weekend's events will be followed by a lot of uncertainty and further risk aversion as a diplomatic solution is sought."
"RUB, HUF, PLN and TRY will remain vulnerable to contagion in the region and wider-scale capital flight from Russia must be a risk. Russia is unlikely to back down in its support of the regional government in Crimea."
"The importance of Ukraine as a link in Europe's energy supply line and as the point where Russia and the European Union meet, makes the idea that either side just backs down hard to imagine, but equally, provides plenty of incentives to work towards a diplomatic solution. So this will take time."
Key Quotes
"The Crimean reaction to the ousting of the Ukrainian government, the Russian response and the counter-response from the US/Europe, are the focus for markets. The weekend's events will be followed by a lot of uncertainty and further risk aversion as a diplomatic solution is sought."
"RUB, HUF, PLN and TRY will remain vulnerable to contagion in the region and wider-scale capital flight from Russia must be a risk. Russia is unlikely to back down in its support of the regional government in Crimea."
"The importance of Ukraine as a link in Europe's energy supply line and as the point where Russia and the European Union meet, makes the idea that either side just backs down hard to imagine, but equally, provides plenty of incentives to work towards a diplomatic solution. So this will take time."