The dollar exchange rate in Ukraine: should we wait for stability?

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The question around the "dollar-hryvnia" in Ukraine does not cease to attract the attention of citizens. New Year's rollercoats ended in early February, when the black market fell to 26.85. And now, less than a week later, as the green course again crawled upwards and forced the population (the electorate) to worry, having crossed the mark of 27.0. What happens to the hryvnia and whether a stable exchange rate is possible in Ukraine before the end of the year - we will try to understand this in the light of the latest trends.

Shot with a discount rate
January and February are very difficult periods for the Ukrainian currency, when it is necessary to pay foreign debts, the currency inflow to the country is minimal, and in the market there is a lot of consolidated hryvnia overturned from the accounts of the Treasury. Actually, the situation is repeated for the third year in a row, and it seems that the NBU is already fed up with the men and got a tough answer in the form of a sharp increase in the discount rate, which was immediately raised by 1.5 percentage points.

The results of a sharp increase in the rate did not take long. But do not assume that the exchange rate is so good, and it's time to dump the currency. This is not true. In early 2018, the NBU managed to achieve a number of tactical successes, and prices in world markets again unfolded "face to Ukraine", plus the arrival of non-residents in OVDPs inspired the market. However, there are a number of risks ahead, which may well make the future of the hryvnia not so rosy.

After the short-sighted statement by Prime Minister V. Groisman, who asked to publicly lower the discount rate immediately after raising it, it became clear that a conflict is brewing between the NBU and the Cabinet.

For those who expect more accurate forecasts for the exchange rate for 2018, it is worth waiting until the second half of March 2018, then the prospects for exchange rate dynamics will become clearer.

27-28 UAH for a dollar is a quite possible exchange rate, of course, if our politicians do not get into disputes with the IMF or provoke another veche on the Maidan.