The slight strengthening of the hryvnia, which is now observed, is due to the low purchasing power of Ukrainians, as well as the undermined financial condition of our citizens for two months of quarantine, when many lost their income
Due to low purchasing power there is no demand for foreign currencies. On the contrary, people surrender their last or penultimate foreign currency savings in order to feed themselves and survive the rest of the quarantine period and the restrictions associated with it.
, due to the lack of demand for foreign currency and the presence of demand for the hryvnia and there is a slight strengthening of our national currency.
In addition, works and will continue to work factor positive expectations in connection with the very likely signing of a new program between Ukraine and the International Monetary Fund, which will bring quite large foreign exchange earnings from th IMF and other partners, is targeted for the cooperation with the Fund. In addition to the IMF tranche, there will also be money from the European Union, the World Bank and the governments of several countries.
This means that the currency balance will be positive, not even despite the fact that now for objective reasons we have much lower foreign exchange earnings from Ukrainian workers.
Read also Is it worth waiting for the dollar to fall: the analyst gave a forecast There are no purely economic reasons for the devaluation of the hryvnia today. On the contrary, there are opportunities to strengthen it. But much will depend on the policy of the National Bank. After all, almost all previous years, due to the devaluation of the hryvnia, the NBU together with the government solved budget problems. In order to fill the budget, they constantly devalued the hryvnia.
Today, budget problems are very big: due to the coronavirus, the budget deficit has tripled - from 100 billion hryvnias to almost 300 billion hryvnias . Accordingly, there is again a great temptation to fill the budget in this way.
If the government and the NBU leadership decide to move this way again, we may soon get a course which is included in the budget for 2020 year, ie 100 , 5 hryvnias per dollar.
If the government and the NBU do not artificially devalue the hryvnia, and its exchange rate will be determined by purely economic circumstances, it can be stable and will remain at today's level and even strengthen - at least up to 26 hryvnia per dollar.
Andriy Novak, Chairman of the Committee of Economists of Ukraine, Candidate of Economic Sciences, specially for Glavred