Ruble’s fall doesn’t rule out further rate cuts

The sharp fall in the Russian ruble today has raised the risk that the central bank pauses its easing cycle when it meets later this month. The situation is in a state of flux and the outlook for interest rates will depend in part on whether US sanctions escalate. But as things stand, the shift in market expectations – investors are no longer pricing in any interest rate cuts over the coming year – looks like an over-reaction.