The hryvnia exchange rate strengthened to 28.18 hryvnia per dollar on Friday morning, January 22, after the National Bank of Ukraine kept the discount rate at 6% per annum. At the same time, the financial regulator lowered the forecast for the rate at the end of the year to 7% from 7.5% per annum and does not rule out raising the rate in the future. Andriy Shevchyshyn, the head of Forex Club’s analytics department, told UA-Times about the short-term prospects of the national currency.
The National Bank also kept the forecast of the country’s Gross Domestic Product loss at 0.2% due to the January lockdown. In addition, the regulator noted the progress in negotiations with the International Monetary Fund’s mission to revise the stand-by program and appreciates the chances of its revision.
Now the market is the main driving force. When the exchange rate approaches the mark of 28.3 hryvnias per dollar, currency sales are intensifying, including from the City, which usually represents the interests of non-residents. However, the downward course is not active.
On Friday, the situation may change slightly, and the lack of value-added tax (VAT) refunds will give the market more sales, which will allow the hryvnia to strengthen.
Probably, in the near future the hryvnia will remain in the range of 28.1 – 28.3 hryvnia per dollar, with an attraction to the lower limit of the range, the expert said.
Translation: Ann Loboda