Dollar at 45 UAH: what will happen to the exchange rate in the near future
30 September 2024 18:35
ANALYSIS FROM 
The Cabinet of Ministers has set an average annual exchange rate of 45 hryvnia to the dollar for 2025. However, economists are not yet able to confirm the hryvnia’s firmness. [Kommersant] has figured out what can affect the hryvnia’s appreciation or depreciation and what guarantees the NBU can provide
45 hryvnias to the dollar is a manageable figure that largely depends on the actions of the state, economist and futurist Andriy Dligach said in an exclusive interview with . The main pressure on the exchange rate will remain, as Ukraine is an import-dependent country, and therefore the need for foreign currency is high.
“The only thing that can keep the hryvnia up in 2025 is the amount of international aid that is higher than our balance of payments deficit and trade deficit. Accordingly, the hryvnia exchange rate will be positively influenced by the need to exchange foreign exchange earnings from partners for hryvnia for domestic use,” Andriy Dligach said
Dligach is convinced that there will be a surplus of foreign currency and that the exchange rate change will most likely demonstrate the difference in dollar and hryvnia inflation. Since hryvnia inflation is expected to be around 9%, and dollar inflation is expected to be 2-3%, we have indicators of hryvnia devaluation against the dollar, the economist says.
The role of the NBU
The National Bank has the ability to influence the exchange rate to stay within the budgeted targets. According to Vasyl Furman, Doctor of Economics, member of the Council of the National Bank of Ukraine, the exchange rate specified in the budget is a technical calculation and does not oblige the NBU to do anything. However, the NBU’s policy in the foreign exchange market is a flexible exchange rate policy.
“The NBU’s policy will be aimed at maintaining stability and controllability of the situation in the foreign exchange market. This is important for fulfilling the NBU’s main priority task of returning inflation to the 5% target in the coming years and keeping it at a moderate level,” Vasyl Furman said
The NBU Council member also notes that the exchange rate will continue to act as a shock absorber and will allow for better adaptation to fundamental market factors. Moreover, we need to understand that our currency market is unbalanced. To fulfil the NBU’s tasks, the National Bank will maintain an active presence in the foreign exchange market of Ukraine, compensate for the structural deficit of foreign currency and protect the exchange rate dynamics from sudden movements, Furman adds
“There will be moderate fluctuations of the hryvnia in both directions: both in the direction of weakening and strengthening, both on relatively short and long time frames, depending on changes in market conditions,” Vasyl Furman said
Summing up, we have macroeconomic stability, moderate inflation, and a stable banking system, the NBU Council member said.
“The hryvnia is attractive for investment, and the National Bank is doing a lot to ensure this, in particular, by keeping the key policy rate low,” Vasyl Furman said
Furman is confident that the exchange rate situation will be stable and controlled in 2025.
Author – Anastasia Fedor
