From 9:00 a.m. on July 21, 2022, the National Bank of Ukraine adjusted the official rate of hryvnia to the US dollar by 25% to 36.5686 UAH/USD, taking into account the change in the fundamental characteristics of the Ukrainian economy during the war and the strengthening of the US dollar to other currencies.
This is stated in the NBU message, Ukrainian News Agency reports.
The National Bank emphasizes that such a step will increase the competitiveness of Ukrainian producers, bring closer exchange rate conditions for different business groups and the population and support the sustainability of the economy in the conditions of war.
The official exchange rate of hryvnia to the US dollar is still fixed.
Under the conditions of high uncertainty caused by the war, a fixed official exchange rate to the US dollar is the main anchor of stabilizing expectations and a key means of fulfilling the NBU's priority goals.
They are to ensure price and financial stability, which is an important prerequisite for economic recovery.
According to the estimates of the National Bank, the correction of the exchange rate will increase the inflow and, accordingly, the sale of foreign exchange earnings by exporters, minimize the speculative component of the behavior of market participants and allow stabilizing exchange rate expectations.
The correction of the official hryvnia exchange rate will have only a limited impact on the acceleration of price growth, caused in recent months primarily by the consequences of the war for the supply of goods and services and the cost of logistics, as well as the dynamics of prices on the world commodity markets.
Instead, fixing the official rate at a new sustainable level will allow the NBU to maintain control over the price dynamics in Ukraine.
The conditions for setting the rate of sale and purchase of currency in the cash and non-cash segments of the market remain unchanged.
The sale and purchase of currency by banks at the request of customers in the cashless segment of the foreign exchange market will continue to be carried out at a rate that cannot deviate more than 1% from the official one.
NBU notes that the currency sale rate in the cash segment of the foreign exchange market will continue to be determined by demand and supply on it.
In order to balance supply and demand in the foreign exchange market, the National Bank also takes additional measures.
Firstly, the NBU will allow banks to sell cashless currency to citizens from July 21 with subsequent placement on a deposit for a period of three calendar months without early termination within the monthly limit of UAH 50,000 (equivalent).
This will create an alternative to investing in cash currency, which will reduce the demand for it and the pressure on the exchange rate in the cash segment of the foreign exchange market.
As Ukrainian News Agency earlier reported, the NBU fixed the official hryvnia exchange rate at 29.2925 UAH/USD from February 24.
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