the-exchange-rate-may-not-be-stable-but-the-nbu-will-smooth-out-dangerous-fluctuations-nbu-governor

The exchange rate may not be stable, but the NBU will smooth out dangerous fluctuations - NBU Governor

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In 2024, the corsus may fluctuate in both directions. However, the NBU will smooth out excessive fluctuations and ensure exchange rate stability.

This was stated by NBU Governor Andriy Pyshnyi in an interview with the We-Ukraine TV channel, UNN reports .

The exchange rate can fluctuate in both directions, as it is affected by seasonality, supply and demand. But the National Bank says that we will be present in the foreign exchange market and will smooth out excessive and dangerous fluctuations.

- Andriy Pyshnyi noted. 

He also reminded that the NBU traditionally does not give a forecast for the dollar, "but declares that it will effectively ensure the mandate of price stability and exchange rate stability

Details

Since the beginning of the full-scale war, the cash exchange rate of the national currency has been constantly floating, while the official exchange rate was fixed. This resulted in a difference, the so-called multiplicity of rates.

If this difference is significant, it leads to arbitrage, speculation, and the inability to ensure exchange rate stability and, importantly, to create expectations of stability

- Andriy Pyshnyi explained.

Therefore, one of the National Bank's tasks was to remove this difference. 

Eventually, according to Pyshnyi, the hryvnia became more "attractive," which allowed the government to abandon the exchange rate fixation and move to managed flexibility.

This enabled Ukrainians to make financial decisions based on macrofinancial stability and exchange rate stability.

Міжнародні резерви України за рік зросли на 42%05.01.24, 11:39

Anna Onishchenko

Economy

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