The National Bank of Ukraine is currently maintaining a stable exchange rate for the hryvnia, despite persistent demands from the International Monetary Fund for its devaluation. According to insider sources, the IMF insists on lowering the national currency’s rate ahead of final negotiations for a new credit support package for Ukraine.
This is reported by Finway
Impact of Devaluation on the Economy and Society
The devaluation of the hryvnia could lead to additional tension in Ukrainian society, especially during the ongoing confrontation with Russia. Ukraine’s budget heavily relies on external financial assistance, so a sharp decline in the national currency’s rate could significantly affect inflation and economic stability.
“The National Bank is under pressure from the IMF, which demands the devaluation of the national currency in a country exhausted by war,” the article states.
Risks and the National Bank’s Position
According to sources, the leadership of the National Bank of Ukraine opposes devaluation, citing risks to inflation stability and public sentiment. The political consequences of such a move are also taken into account, as devaluation during wartime could lead to increased dissatisfaction among the population.
Despite the National Bank’s resistance, the issue remains relevant, as Ukraine heavily depends on international financial support, particularly from IMF resources. A final decision may be made after the negotiations regarding the new credit program are completed.