In Ukraine over the past few weeks much stronger hryvnia. Large foreign currency earnings of farmers and low activity of importers allowed the national currency to strengthen to the level of 26.26 hryvnia to the dollar. The last time this course was at the end of last year. The website “Today” to figure out when to expect the devaluation of the hryvnia and what affects the foreign exchange market in Ukraine.
What happens to UAH and what to expect the course
More than half of foreign exchange earnings in Ukraine the revenues from the export of raw materials. The hryvnia exchange rate depend directly on crops, production of steel and metal prices on international commodity markets. Fall prices reduced foreign exchange revenues – the dollar against the national currency becomes more expensive.
In early February the official exchange rate of hryvnia made up of 27.02, and at the moment fell to 26.26 hryvnia. Deseve “green” in the last time was December 26, 2016. The national currency has strengthened primarily due to revenue from agricultural products, says the head of analytical Department of the IC Concorde Capital Oleksandr Parashchiy. Economists such capacity called the “seasonal factors” – agricultural companies to make revenue in order to carry out the sowing. In addition, many Ukrainians spend accumulated before the economic crisis dollars, and importers are traditionally distinguished in this period of low activity. As already said, website “Today”, the Ukrainians EN masse surrender of the currency to banks, net redemption for the day reaches $ 10 million.
Some of these factors will be relevant until at least mid-summer, however, Alexander para sure after a few weeks the hryvnia will change the trajectory of the dollar will rise. “We see that the volume of steel production the last months of fall, and prices on world markets are slightly reduced. Most likely, in the future, less than a month we will see that the hryvnia will weaken,” explains the expert.
“We see that the volume of steel production the last months of fall, and prices on world markets are slightly reduced. Most likely, in the future, less than a month we will see that the hryvnia will weaken,” explains the expert.
Already in July, the hryvnia can be bought for 27 hryvnia, suggests Alexander steam. For currency will affect the situation on the commodity markets, and the decision of the court of arbitration between Naftogaz and Gazprom. By the end of the year, according to estimates by Concorde Capital, devalue the hryvnia to the level of 28.5 hryvnia to the dollar.
Senior analyst “Alpari” Vadim Iosub notes: hryvnia strengthened not only because of the high foreign currency revenues of Ukrainian exporters. Last time, the expert said, the dollar is steadily losing ground against all currencies.
“The dollar is falling due to weak U.S. economic data and ongoing scandals around the figure of President Donald trump, due to which already there are voices about a possible impeachment. Although the success of this impeachment looks unlikely today, political tensions among the political elites of the USA further pressure on the dollar, which only in the last two weeks rose to Euro with 1,0850 to 1,1250”, – notes the analyst.
“The dollar is falling due to weak U.S. economic data and ongoing scandals around the figure of President Donald trump, due to which already there are voices about a possible impeachment,” the analyst notes.
In “Alpari” I believe that is a favorable situation for the hryvnia may last until mid or even end of years. During this time, according to experts, the dollar in Ukraine will drop to 25 hryvnia. “The growth of the dollar, which is possible in the second half of 2017, will be quite smooth. By the end of the year, the dollar is unlikely to exceed the range of 26.5-27 UAH”, – predicts Vadim Iosub.
In the near future on the prospects of the dollar can affect the outcome of the work of the IMF mission in Ukraine. However, if it will end the rhetoric about cooperation, the impact will be minimal.
Official forecasts and “offended” hryvnia
Recently, one of the most influential business publications, The Economist included the hryvnia in the list of undervalued currencies. They estimate that one dollar in Ukraine has to cost 8.3 hryvnia. To such conclusions experts have come, having made the big Mac index. The basis is the cost of big Mac in the States and it is believed that the currency of any country he is in terms of dollars should cost the same. If there is more currency is overvalued to the dollar, less undervalued. So a big Mac in Ukraine is 1.54 dollars, that is 42 of the hryvnia. In American McDonald’s Burger costs 5.06 USD. Taking into account the official exchange rate, analysts have calculated that the dollar should cost 8.3 hryvnia.
However, the likelihood that the dollar in Ukraine will again cost 8.3 hryvnia, Ukrainian analysts estimate as “very low”. While the situation is exactly the opposite – the us currency continues to rise against the Ukrainian.
According to estimates of the Cabinet, the dollar by the end of the year will reach of 30.2-32.8 per manen. the currency impact including blockade of Donbass: enterprise in the occupied territories brought Ukraine’s export revenue, in addition, they depended on the stable operation of the entire metallurgical complex.
It should be noted that the hryvnia exchange rate the national Bank is responsible. Infusion of foreign exchange allow the NBU to increase the dollar supply in the market. The ratio of supply and demand determines the exchange rate. “The national Bank is ready to enter the market with currency interventions to smooth excessive fluctuations and has enough tools for this. The volume of international reserves at the beginning of January amounted to 15.5 billion dollars. This is for the sale of currency in the course of the intervention, and to perform the obligations of the government and the NBU”, – reported in the NBU.
What affects the exchange rate of hryvnia
From the dollar in Ukraine depends on the cost of gasoline, said Deputy Director of the SEC “Psyche” Gennady Ryabtsev. So, after the devaluation of the hryvnia against the dollar by ten cents, there is economic justification to increase the cost of gasoline by seven cents. 80% of light oil products Ukraine imports, in addition, the currency to pay taxes. “We have a full proportionality from the devaluation of the exchange rate rising prices as does the price in euros or dollars, as for the import, and simply multiplied by the rate upon transfer to the national currency. Plus and taxes increase. So the prices are still rising slightly more than the devaluation,” – explains the ex-Minister of economy Viktor Suslov.
In the formula, according to which the Cabinet has calculated the tariff for gas for the population, laid the dollar. The government has decided to revise the cost of imported gas every six months (regulation No. 90). If the tariff is recalculated to reflect the new dollar and more costly imported fuel, according to experts, the cost of a cubic meter of blue fuel will range from 8 to 11 hryvnia (now 6,8 hryvnia).
Expert food markets Fedor Rybakov adds: in the first place along with the dollar becoming more expensive bananas, citrus, fish, cheese and deli meats. For example, the price of bananas in supermarkets are always 1.1 to 1.2 dollarsa pounds.
In addition, the hryvnia exchange rate “tied” prices on foreign cars. “Prices are clearly linked to the exchange rates of the supplier’s country. How will the hryvnia, dollar, Euro, ruble and will change prices. Recent years and months they’ve been growing”, – says Director for marketing of group of companies “AIS” Sergey Borovik
The same situation on the real estate market. Prices for “secondary housing” is set forth in U.S. currency. If, for example, the apartment cost 30 thousand dollars at the moment will cost 787 thousand hryvnia, after a rise in price of the American currency on one hryvnia for the same apartment will have to pay is 817 thousand.