Ruble dives the most since oil crash in 2015

Bloomberg

Some of Wall Street’s biggest banks are warning investors to steer clear of Russian assets after the ruble’s worst week since the 2015 oil crash amid mounting risks of crippling sanctions from the U.S.
Morgan Stanley turned bearish and UBS Group AG closed its recommendation to buy the Russian currency, with analysts at both banks saying in notes that the risks outweigh the reward for owning the ruble.
Diana Amoa, a money manager at JPMorgan Asset Management, puts the likelihood of curbs on Russian sovereign debt at as high as 50 percent.
A fresh batch of sanctions introduced this week added to mounting concerns that the US is about to start ratcheting up the severity of its restrictions against Russia.
The worst-case scenario is a bill introduced in Washington that seeks penalties on banking transactions and new Russian sovereign debt as punishment for meddling in the 2016 presidential elections.
“Geopolitics is what keeps us all up,” Amoa said in an interview with Bloomberg Television. “We’ve seen a lot of sanctions coming through ahead of the mid-term elections. I think there is an incentive to send a strong message that the US will not allow interference in their democratic processes.”
Amoa said she has reduced holdings of Russian assets because the tail risk from potential sanctions is “just too large.” High foreign ownership of Russian sovereign debt means that sanctions would have a big impact on bond yields, she said.
Foreigners held about 28 percent of the nation’s outstanding ruble debt as of July 1, according to central bank data.