Ukrainians sell foreign cash in October

Individual Ukrainians sold net USD 114 mln in foreign cash in October as USD 179 mln was sold and USD 65 mln was purchased, the NBU reported on Nov. 7. The figure was somewhat lower than in the prior month (net USD 283 mln) and lower than average net monthly sales for 9M16 (USD 256 mln). Since the year start, individual Ukrainians have sold USD 2.4 bln net.

Alexander Paraschiy: Further active foreign cash sales by individuals tell us that Ukrainians are quite confident in the national currency’s future. Such optimism is buttressed by hryvnia strengthening tendencies, rising 1.7% to UAH 25.51/USD in October. We link the positive developments at the ForEx to good news from external markets (rising prices for metals) as well as the recent approval of the IMF loan and the placement of U.S.-guaranteed Eurobond. Still, in light of the anticipated reverse in resource prices and scarce capital inflow from abroad, we expect the national currency to resume weakening. By the year end, we expect the hryvnia will touch the UAH 26.5/USD level.