Non-residents increased their OFZ holdings in January

In January, foreign capital inflow into the Russian equity and OFZ markets resumed on the back of an improving external economic environment and an increasing risk appetite among investors. For the first time since July 2018, the share of non-residents’ OFZ balances in foreign depositories’ accounts with the National Settlement Depository (NSD) rose to 24.4% as of the end of January, reports the new issue of the Financial Market Risk Review.

No seasonal deterioration of foreign currency liquidity was registered in December 2018 — January 2019. The fact that the Bank of Russia resumed its foreign currency purchases as part of the fiscal rule and announced that it would execute postponed purchases within three years failed to produce any material effect on the FX market.

The prolonged oil price decline in 2018 Q4 and closed global markets resulted in a one-day (25 December 2018) surge in the volatility of short-term oil futures, which, however, failed to shatter the stability of the Russian financial markets.