Buč massacre gave political courage to toughen sanctions – Roklen24.cz

According to the latest information, Western countries are preparing another package of sanctions against Russia, which is still continuing its unprovoked invasion of Ukraine. Whether Putin’s regime is at the end of its tether is hard to say, but in addition to the attack on Russian territory, Ukrainian troops managed to regain some of the territory under their control. One of the liberated territories was the city of Buchi, where stories of the behavior of the Russian occupiers shocked the whole world. The bodies and other remains of the Russian army have been marked by the inhuman treatment, torture and execution of civilians. The chilling testimonies of the freed Buchi and the bodies lying in the streets seem to have provided additional motivation to end the war as soon as possible and help Ukraine, both with financial and material aid and by imposing new sanctions. Putin’s regime.

The actions of the occupiers in Ukraine are condemned around the world. Almost immediately, representatives of the European Union assured the public that further measures were in the works. Economic sanctions against Moscow can be expected to increase. However, their extent is not yet known. After all, at least so far, breaking relations with Russia has not been on the table. Germany and other EU economies are directly dependent on gas and oil imported from Russia. Thus, we can expect efforts from the major economies to maintain the relationship at least at a level that will allow the purchase of energy raw materials.

The dance between war crimes and Russian gas addiction has a number of unenviable steps, variations and pirouettes. German Finance Minister Robert Habeck assured reporters at a press conference that Germany was trying to reduce its dependence on Russian gas. Progress in these efforts would be surprisingly rapid. But let’s pour clean wine. A transformation that would allow the German economy to function smoothly without Russian gas would take several years. Maybe a decade. We do not expect significant progress in this regard, which will be reflected in the approach of the EU and Germany in the form of possible sanctions and additional assistance to the Ukrainian people.

Despite everything, the French president promised to discuss new sanctions against Russia in the coming days. It can be assumed that EU representatives are prepared for a similar situation. Final sanctions are expected to be announced by the end of the week. Russian gas flows through pipelines further into Europe. Despite the open condemnation of the actions of the Russian military and the preparation of new sanctions. Despite the ambiguity of the new terms of payment, they must state the obligation to pay for gas in rubles. That is to say with the exception of certain countries (according to speculation, Germany and Italy), which will continue to be able to pay on accounts in euros with Gazprom. Russia needs to sell gas almost as much as Europe needs to buy it.

The escalation of the situation threatens to complicate the ceasefire negotiations between Ukraine and Russia. And it will not be only because the deputies will be upset by the revelations of the war crimes in Buč. Indeed, it cannot be assumed that Russian representatives will be willing to negotiate at a disadvantage. In addition to the loss of certain strategic positions, they are under pressure from world powers after the detection of war crimes.

Despite the expected obstacles to negotiations between Ukraine and Russia, currencies in the region, including the krone, remain relatively strong against the euro. This information is strange, because in recent days and weeks, the exchange rate of the region has reacted positively to any change in the negotiations. This relationship doesn’t seem to work the other way around.

OUTLOOK TODAY

The dollar is exchanged against the euro at the RoklenFx online exchange office at a central rate of 1.0972 EURUSD, the dollar index is then at 98.97 points. During the day, the EURUSD exchange rate should oscillate between 1.0913 and 1.1069 EURUSD.**

The koruna is currently trading against the euro at the online exchange RoklenFx at a central exchange rate of 24.35 EUR and against the dollar at a central exchange rate of 22.19 USD. According to our forecast, the exchange rate against the euro should remain in the range of 24.22 to 24.44 EURCZK, in a pair with the dollar of 21.91 to 22.36 USDCZK.**

** The average nominal exchange rate published by the ECB will, according to the models used, be highly probable within the said interval. The exchange rate forecast is based on a time series model that takes into account the previous value of the exchange rate and its past volatility. In addition, the macroeconomic disclosure factor is integrated into the model to more accurately determine future volatility. The model is thus able to determine when an increase or a decrease in the volatility of the exchange rate can be expected.

Disclaimer: This article is provided for informational purposes only and does not constitute an investment recommendation under Act No. 256/2004 Coll. on capital market activities. In preparing this article, the author relied on publicly available sources. Roklen Holding as and Roklen360 as are not responsible for errors in text or data.

Source Information: RoklenFx, ECB, Fed, CNB, COT, TradingView, United States Statistical Office, Ifo Institute, CZSO, Bloomberg, Reuters

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