Why the dollar is stuck near 45 hryvnia and what the National Bank of Ukraine (NBU) is doing
On the interbank market there is currently increased pressure on the hryvnia, but the main regulator remains the National Bank of Ukraine (NBU). According to analyst Andriy Shevchyshyn’s forecast, the critical range for the interbank market on 5−10 October will be 44.90−45.10 hryvnia/$ and there is a noticeable risk of moving above 45 hryvnia.
To prevent the dollar from establishing itself permanently above 45 hryvnia, the NBU is actively intervening and adjusting the euro rate to maintain control over the dollar. By the given estimate, in September the regulator sold about $5.5 billion on the foreign-exchange market — a record figure that indicates intensive use of reserves to curb the pressure.
Could the official rate stay above 45 hryvnia for long?
A brief move above 45 hryvnia alone would not necessarily mean a shift to a new level. Shevchyshyn notes that the signal for the market will be if the official NBU rate settles above 45 hryvnia for at least a few days.
The baseline scenario now envisages movement within the 44.90−45.10 hryvnia/$ zone, but the risk of breaking higher remains. If the regulator continues active interventions, growth can be temporarily contained, but with large volumes of deficit and continued reserve sales the pressure on the hryvnia will not disappear.
How a breach of 45 hryvnia would affect the cash market, cards and savings
In the cash market the dollar, according to Shevchyshyn, may be within 45.10−45.50 hryvnia, which means slightly higher buy and sell rates at exchange offices. This will directly affect people who exchange cash while travelling abroad or who accumulate dollars at bank counters.
For holders of foreign-currency cards and savings the effects are less direct but noticeable. Payments and conversions will take place at the official NBU rate, which the regulator is trying to keep near 45 hryvnia. If the official rate rises and becomes established above that level, it will make buying imported goods more difficult and make hryvnia savings riskier in terms of exchange-rate losses.
What will determine the euro’s dynamics and the NBU’s options
The euro largely depends on the behaviour of the EUR/USD pair. If EUR/USD falls below 1.122 the analyst does not rule out a further move towards 1.08, which would increase pressure on the euro in hryvnia terms.
In that case the NBU will have to balance between two options of selling and supporting the rate. The regulator will either allow the official euro rate to fall below 50 hryvnia or let the dollar appreciate against the hryvnia. On the cash market the forecast range for the euro is 50.80−51.30 hryvnia, and this is an important reference point for those holding savings in euros.
In sum, the main factor of this wave remains the NBU’s foreign-exchange interventions. As long as the regulator is ready to actively sell currency it can restrain the dollar’s movement, but a large currency deficit and record intervention volumes mean the pressure on the hryvnia has not gone away. Therefore in the coming days the primary marker for the market remains 45 hryvnia per dollar.
