Ukraine’s currency market remains stable from October 6 to October 12, with no significant fluctuations in the exchange rates of the dollar and euro expected. The National Bank continues to use a managed flexibility regime, which helps maintain balance in the financial system and prevents sharp jumps in exchange rates.
This is reported by Finway
Factors Affecting the Hryvnia Exchange Rate
The Director of the Financial Markets and Investment Activities Department at Globus Bank, Taras Lesovyi, notes that the hryvnia is receiving support due to a decrease in inflation. From June to September, inflation in annual terms has decreased by almost 4%, positively impacting the national currency. Favorable dynamics are also supported by seasonal price reductions for food — this is a traditional period when the financial sector and consumers gain additional advantages.
An important decision for the market was the National Bank’s maintenance of the discount rate at 15.5%, which, according to experts, is aimed at supporting financial stability, controlling inflation expectations, and strengthening trust among businesses and the public in the banking system.
Internal and External Risks for the Currency Market
October is traditionally characterized by increased activity among market participants due to the end of the quarter and companies preparing for tax calculations. This seasonal factor may temporarily increase demand for foreign currency; however, it does not pose a significant threat to stability.
- There are external risks that may affect the currency market:
- unpredictable events on the front;
- possible disruptions in international support for Ukraine;
- the threat of missile and drone attacks on energy infrastructure, which typically intensifies in the fall.
“Additionally, a high exchange rate of the hryvnia to the dollar is set at 45.7 UAH to the dollar. This is one of the reasons why revenues increased by 446.8 billion hryvnias,” she said.
Previously, the National Bank allowed the hryvnia to temporarily weaken by reducing the volume of currency interventions to $560 million per week, which is already below the average level since the beginning of the full-scale war. The projected high dollar exchange rate, accounted for in the draft state budget for 2025, directly impacts the country’s revenues, increasing tax receipts.