Ukraine hryvnia weakens to UAH 26.5/USD

Ukraine’s currency, the hryvnia, slid 3.8% to UAH 26.5/USD on March 14 after making gains on March 9 and 10, when it was traded at UAH 25.5/USD. That was its strongest value since the start of February.

In response to the weakness, the National Bank of Ukraine resumed its ForEx interventions, selling USD 11.4 mln on March 12 and USD 60 mln on March 14. On March 3 and March 10, the NBU purchased USD 30.0 mln and USD 51.1 mln, respectively.

Alexander Paraschiy: The trend with the hryvnia returning to the UAH 26-27/USD range is in line with our expectations. As we discussed last week, the hryvnia strengthened on March 9-10 due to an inflow of delayed export proceeds. In particular, turnover at the ForEx on March 10 reached USD 419 mln and even increased to USD 460 mln on March 11, compared to nearly USD 240 mln in daily turnover since the year’s start. Now the situation is returning to a more normal trading regime and we should see the hryvnia in the range of UAH 26.5-27.0/USD in the nearest future. By the year end, we project the hryvnia at UAH 27.5/USD.