21 February 2020, Friday, 18:06 406

Bankers And Analysts Predicting Hryvnia Exchange Rate Will Remain Unchanged At 24.3-24.8 UAH/USD In March

Editor: Daria Zubkova

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Bankers and analysts are predicting that the hryvnia’s exchange rate will remain unchanged at 24.3-24.8 UAH/USD in March.

Bankers and analysts stated this in comments to the Ukrainian News Agency.

“February in the foreign exchange market is quite calm. We see small fluctuations of the dollar within 10 the range of kopecks. The National Bank is still the main market maker, constantly smoothing out sharp fluctuations. The exchange rate has recently been around 24.50 UAH/USD, which is the current indicator for the market. The main sellers of currency on the market are large agricultural exporters and steelmakers," said Yaroslav Kabin, the director of the treasury department at Idea Bank.

According to him, non-resident buyers of government bonds have no significant presence on the market, which indicates a gradual fading of interest in Ukrainian public debt.

“We expect an exchange rate range of 24.30-24.70 UAH/USD at the end of February, and we have not yet seen any tendencies towards devaluation or revaluation in the near future. An increase in supply of foreign currency from agricultural exporters is possible in March because of preparations for the new season. However, as usual, the regulator will try to buy surplus currency from the market. Therefore, we expect an exchange rate in the range of 24.00-24.80 UAH/USD in March," he said.

Yevhenia Akhtyrko, an analyst at Concorde Capital, is also forecasting relative stability of the hryvnia’s exchange rate in the near future.

"The supply of foreign currency exceeds demand on the interbank market in February. Therefore, a revaluation pressure is being felt. According to market participants, the foreign exchange market was provided by the sale of currency by farmers and steelmakers. At the same time, the National Bank is trying to prevent an excessive depreciation of the hryvnia by acting as an active buyer of foreign currency. Under such conditions, it is most likely that the exchange rate will be 24.5 UAH/USD,” Akhtyrko said.

According to her, the results of the recent auctions on government bonds showed that the interest of non-resident investors in hryvnia-denominated securities has most likely faded.

This deprives the foreign exchange market of a significant currency flow, which had a significant impact on the exchange rate last year.

At the same time, according to her, the traditional spring inflow of currency from farmers is likely to continue.

"At the moment, it is difficult to predict the factors that could exert significant devaluation pressure on the hryvnia. It is possible that the foreign exchange market will again be subjected to psychological attacks related to predictions about "government-bond pyramids that will collapse." This will cause outbreaks of panic, which will influence the determination of the exchange rate," Akhtyrko said.

As Ukrainian News Agency earlier reported, JP Morgan (United States) predicted in October that the hryvnia could devalue to 25.5 UAH/USD in the first quarter of 2020, 26.3 UAH/USD in the second quarter, and to 27 UAH/USD in the third quarter.