Will the United States impose sanctions against Russia?

Challenge

Changes in trade relations often come without public precursors as governments hold talks behind closed doors. With the relationship between the US and Russia especially volatile in recent times, new developments frequently arise without precedent and have a wide-ranging impact on the markets.

Solution & Analysis

Predata’s predictive signal anticipating U.S. sanctions imposed against Russia is based on traffic from Russian- and English-language web pages related to frequent targets of sanctions, extreme wealth in Russia, and major Russian financial institutions. The Predata machine learning algorithms identified individual pages within the broader set that tended to exhibit consistent behavior in the 30 days preceding U.S. sanctions impositions going back to 2014. In April 2018, the top sources driving the predictive model included pages related to Russian political repression, organized crime, and the natural gas sector.

Result

The Predata signal that anticipates U.S. sanctions impositions against Russia spiked sharply in late March 2018. Less than a week after the signal spike, the Trump administration announced sanctions against Russian oligarchs and government officials. On the back of this news the USD/RUB abruptly jumped from 57.4380 to 63.0646.