Next week, the Ukrainian currency market is anticipated to maintain a stable and predictable environment. Despite demand for foreign currency exceeding supply by 10-15%, the National Bank of Ukraine (NBU) is expected to manage the market effectively through currency interventions.
Key Highlights:
- Overall Situation: The market is projected to remain stable, with interbank demand surpassing supply by 10-15%. The NBU will adjust the exchange rate through interventions.
- No Major Fluctuations: The economy has adapted to fuel prices, and the initial reaction period has concluded. Traditionally, spring sees lower currency demand.
- Cash Market: There is no shortage of currency in banks and exchange offices, with a minimal difference of 10-15 kopecks between cash and interbank rates.
- Deposits: A decision by the NBU on April 30 may raise the yield on hryvnia deposits by 0.5-1 percentage points in May.
- External Influences: Global instability, particularly in the Middle East, could strengthen the dollar, leading to a stable dollar for Ukraine but potentially lowering the euro by 0.85-0.90 UAH.
- Forecast for April 13-19: The dollar is expected to hover around 44 UAH, while the euro will be near 51 UAH. Cash corridors will range from 43.5-44.5 UAH for the dollar and 50.5-52 UAH for the euro.
- Exchange Rate Changes: Daily fluctuations are predicted to be minimal, ranging from 10 to 30 kopecks depending on the institution.
According to financial analyst Lesovyi, the currency market in Ukraine is likely to reflect a situation similar to previous weeks. He noted, “Demand will continue to exceed supply in the interbank market, but this gap is expected to remain within acceptable limits: demand is projected to be higher than supply by 10-15%. Under these conditions, the NBU will play a crucial role, closely monitoring market dynamics and adjusting the rate through interventions.”
Reasons for Stability:
Lesovyi explained that the economy has already adjusted to new prices following fuel increases. With the initial reaction phase over, there are no significant grounds for new waves of exchange rate fluctuations at this time. Additionally, spring typically sees lower currency demand, and there is no observed cash shortage in banks and exchange offices.
Increased Appeal of Deposits:
The expert added that the NBU’s decision on April 30 could enhance the attractiveness of hryvnia deposits, allowing depositors to not only offset inflation but also gain a modest passive income in May.
Impact of Middle Eastern Events:
Global instability remains a key external factor. Should tensions in Iran escalate, the dollar may strengthen globally as a “safe haven” asset. For Ukraine, this would mean a stable dollar due to the NBU’s policies, while the euro could depreciate significantly (theoretically by 0.85-0.90 UAH).
Forecast for April 13-19:
- Exchange Rate Forecast: The dollar is expected to remain around 44 UAH, while the euro will be about 51 UAH.
- Cash Corridors: The dollar will range from 43.5-44.5 UAH, and the euro from 50.5-52 UAH.
- Daily Changes: Fluctuations will be minimal, up to 10-20 kopecks in banks and up to 30 kopecks in exchange offices.
- Rate Differences: The average difference between interbank and cash rates will be only 10-15 kopecks, indicating a lack of panic.
- International Market: The basic dollar/euro ratio is expected to be within 1.14-1.16.
What Will the Spread Be Between Buying and Selling?
- In Banks: Up to 0.5-0.6 UAH for the dollar and 0.8-1 UAH for the euro.
- In Exchange Offices: Up to 0.6-1 UAH for the dollar and 1-1.3 UAH for the euro.
This material is for informational purposes only and does not constitute financial or investment advice. Investments carry risks, including the potential for total capital loss. RBC-Ukraine is not responsible for financial decisions made based on this material. It is recommended to consult a licensed financial advisor before making any investment decisions.
The Ukrainian currency market is set for stability next week, with the National Bank managing demand through interventions. Despite a higher demand for foreign currency, no significant fluctuations are expected due to economic adjustments and seasonal trends.