Why hryvnia is strengthening and what to expect in the autumn

June 19, 2017

Is it necessary to be glad from current strengthening of the national currency?

Since the beginning of this month, the US dollar in Ukraine went down in its value, dropping below the 26 UAH per 1 US dollar, according to the NBU rate. A few weeks ago, 1 US dollar costed 26.3 UAH and two months ago — 26.8 UAH. However, in recent days the US currency is trying to restore its positions, but significant changes are not observed. At the end of this week the NBU set exchange rate 26.01 UAH per 1 USD. Thus, the average annual exchange rate, which was laid down in the budget for this year amounts to 27.2 UAH per 1 USD. Strengthening of the national currency continues amid the global trends of dollar depreciation, but yesterday’s decision of the US Federal Reserve to increase the interest rate to 1–1,25% has to change the situation in favor of the US currency.

Summer is traditionally a favorable period for the hryvnia, unlike the end of the year, when hryvnia is under pressure due to the need for energy procurement. How long will Ukrainian currency be strengthened, what factors, except from the seasonality affects it, “Glavcom” asked to comment Razumkov Centre’s expert Vasil Yurchyshyn.

In your opinion, what factors lead to strengthening of the hryvnia?

Usually hryvnia is more strong in the spring and summer rather than in autumn and winter. Besides this, some positions of Ukraine in foreign markets has been strengthened and we can see an improvement in foreign trade balance. We also have a calming economic dynamics, which reduces the risk of influx and flow of capital. It should not be excluded the situation related to administrative measures — the NBU is headed by new person and I think it has a positive impact on the banking system.

Can this process have a stable dynamics? What is your forecast for the second half of the year?

By autumn we have some margin of safety, but in autumn it will begin the struggle over the budget, and we can expect some complications. I would not say that IMF tranche is playing a crucial role now. Much more important factors of small, but economic growth is the survival of population and business, which we now observe. The following trouble for the hryvnia can be xpected in late August and early September, when new economic season starts, new contracts, certainty and uncertainty about next year’s budget. By late summer, significant fluctuations will not be observed.

To what level can hryvnia be strengthened?

It will be minor fluctuations around 26 UAH per 1 USD, plus-minus 20–30 cents.

Vasyl Yurchyshyn

Director, Economic Programmes

Born in 1955 in Kamyanets-Podilskyi.


T. Shevchenko Kyiv State University, Department of Cybernetics (1977).

Institute of Public Administration and Local Government at the Cabinet of Ministers of Ukraine (1994).

Professor in Public Administration. Author of nearly 100 scientific works.


In 1977–1993, worked at the Kyiv University as an engineer, research fellow and senior research fellow;

1994–1999 — head economic researcher at the International Centre for Policy Studies, Fund for Banking and Finance Development;

1999–2004 — Assistant Professor, Department of Economic Policy of the Ukrainian (currently, National) Academy of Public Administration, office of the President of Ukraine;

1999–2004 — Research Director at the Agency of Humanitarian Technologies, later — Agency for Social Analysis;

2002–2003 — advisor to the Minister of Economy of Ukraine;

since April, 2004 — Professor, Department of Economic Policy of the National Academy of Public Administration, office of the President of Ukraine;

since June, 2005 — Economic Programmes Director at Razumkov Centre.

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