The reasons for the currency appreciation are named.
During the outgoing week, the dollar continued to rise in price , and so quickly that the sellers of the currency did not have time to change the price tags. What is happening — a new collapse of the hryvnia has begun, which has not happened since 2015, or everything will return to normal and the dollar will fall in price, reports the Chronicle.info with reference to Today.
What is the reason for such a significant rise in price dollar, what to expect by the end of January and beyond, experts said.
These are Oleg Pendzin, a member of the Economic Discussion Club, Alexander Okhrimenko, President of the Ukrainian Analytical Center, Andrey Shevchishin, Head of the Forex Club Analytics Department, and an analyst at «Center for Exchange Technologies» Maxim Oryshchak.
What happened to the exchange rate over the week
The dollar exchange rate, which stopped its growth for the weekend, began to grow on Monday, as they say, right off the bat — 20 kopecks a day, reaching UAH 28.54 /dollar in cash. The last time the dollar was so expensive was 14 months ago, in November 2020. But on Wednesday, a smooth rollback began — by five kopecks, then another five. By Friday, the exchange rate stabilized at UAH 28.44/USD.
The spread (the difference between the buying and selling rates) gradually narrowed from 26 to 23 kopecks, which gave hope that there might not be further rapid growth in the rate.
The maximum rate at which one could turn in a cash dollar was UAH 28.30 (35 kopecks more expensive than a week ago), the minimum rate at which one could buy a cash dollar was also UAH 28.30 (30 kopecks more expensive than a week ago). Note that such a high purchase rate is observed in exchange offices and banks working to purchase currency. The declared low selling rate is usually virtual, there are no dollars available at such a price. The real selling rate starts from 28.40 hryvnia/dollar, but the buying rate is not higher than 28.20.
The National Bank weakened the hryvnia by 50 kopecks over the week, while the psychological threshold of 28 hryvnia/dollar remained far behind – on Friday it was 28.32 hryvnia/dollar. And on Thursday — 28.40, that is, by the weekend the hryvnia strengthened by 8 kopecks. On Monday, January 24, the regulator maintained the rate of UAH 28.32/USD.
RATE REVIEW 17-21.1.2022
Infogram Analysis of the situation on the market
Experts say that the dollar exchange rate is now influenced by opposite factors: some push it up, others slow down this movement, but cannot reverse the trend towards cheaper prices for a long time.
«Per dollar»: an increase in demand for the currency with its low supply and panic in the market — the exit of investors from Ukrainian hryvnia securities, as well as the last unsuccessful auction of the Ministry of Finance for their sale.
«Against the dollar» ;: The actions of the National Bank are to increase the discount rate of refinancing (the percentage at which the NBU lends the hryvnia to commercial banks) and the sale of significant amounts of foreign currency to them in the interbank market.
«National Bank last Thursday raised the discount rate from 9% to 10% and increased the requirements for commercial banks to reserve funds by 2%, — analyzes Oleg Pendzin. — Also, the regulator sold over $400 million this week in order to bring down the excessive demand for the currency. If not for these actions, the rate could soar above 29 hryvnia/dollar. Nevertheless, non-residents continue to get rid of Ukrainian government bonds, although the yield on them has grown from 12% to 14% per annum. All this seriously puts pressure on the hryvnia».
Andriy Shevchyshyn specified that the portfolio of non-residents in government bonds has decreased by more than UAH 7.7 billion (minus 7%) since the beginning of the year. The expert expects churn to continue.
«The last auction for the sale of government bonds turned out to be a failure due to the low rates offered by the Ministry of Finance, they attracted a little more than UAH 4.1 billion (a week ago it was even less — UAH 3.9 billion), — says Andriy Shevchyshyn. – Non-residents still have great opportunities to accelerate the weakening of the hryvnia. And they are closely following the news and the course of negotiations between the United States and the Russian Federation. But even if non-residents do not show great activity, the market remains hostage to growing commodity, food and energy imports».
Alexander Okhrimenko calculated: if the frosts intensify, as weather forecasters say, then & # 171; Naftogaz & # 187; and gas traders will need at least 2 billion cubic meters. m of gas for the safe passage of the off-season.
«This is 1.8 billion dollars, a significant amount for the market», the expert emphasized.
What to expect this week
Forecasts Experts are disappointing: the hryvnia will continue to devalue.
The most pessimistic is Andriy Shevchyshyn.
«The stabilization of the foreign exchange market will not last long, devaluation risks dominate, — Andriy Shevchishin analyzes. – The market continues to expect gas purchases and an increase in food and commodity imports. The rollback of the rate will be considered as an opportunity to buy currency at favorable prices.
Non-residents and local investors can return to the market after a pause. Next week, we expect the dollar to try to reach the highs of this January — 28.65 UAH/dollar. We are starting to aim for 29 hryvnia/dollar for February».
Maxim Oryschak agrees with him. The expert pointed out that investors are trying to guess the further actions of the US Federal Reserve System (an analogue of the central bank) related to monetary policy. We are talking, in particular, about raising the interest rate, which will make the dollar more attractive as an investment.
«In other words, there are powerful fundamental factors for further weakening of the hryvnia against the dollar. Now the hryvnia has strengthened a little, but in the near future the rate will return to UAH 28.60 per dollar», Maxim Oryshchak is sure.
Alexander Okhrimenko says that the upward trend in the dollar is long, until the end of the winter cold, when it will not be necessary to spend foreign currency on gas purchases. But the National Bank will not allow the hryvnia to devalue above 29 hryvnia/dollar due to foreign exchange interventions.
Oleg Pendzin linked the hryvnia exchange rate in the coming week with the results of negotiations between the US and Russia.
« If rude rhetoric had begun — the hryvnia exchange rate would have collapsed even more, if they had announced that they had agreed on everything — the hryvnia would begin to strengthen. But again, little meaningful words were heard — it means that the rate will remain at the current level», he explained.
Sell or buy currency
Experts' opinions differed. Andriy Shevchyshyn still advises buying foreign currency, but on pullbacks, at the lowest possible rate.
Other speakers now recommend spending the hryvnia surplus on planned large purchases, durable products and manufactured goods. This will prove to be more profitable, as inflation will noticeably accelerate in the coming months.