National Bank increased interest rates and introducing a single rate. In recent weeks, the National Bank repeatedly reduced the official rate, each time updating its historical minimum.
Such regulatory treatment were associated with the decision to abandon the use of indicative rate, providing a single market rate.
National Bank has continuously accelerated approach of the official exchange rate to the market, today announced that the hryvnia will now be set by banks on the basis of market supply and demand.
As a result, banks sell the dollar today has 25 UAH.
Earlier this week it was reported that the National Bank plans to abandon the use of the indicative rate, providing a single market hryvnia exchange rate on the interbank market.
National Bank since late last year makes daily auctions and sells for about $ 3 million a day for undervalued for establishing indicative rate at which banks should focus during operations.
So, on Monday, for example, the average rate was 12.30 as of 16.1764 UAH per dollar, while sales Interbank Exchange carried about 21.50 USD per dollar.
We support the transparent exchange rate policy and the transition to market mechanisms. We also want to market and was the only effective course. Central to the implementation of monetary policy regulator is to continue using the system of flexible exchange rates – Valery Gontareva, the NBU.
However Gontareva said that the regulator does not refuse to influence the market by adminvazheliv and can return to them at any time in the presence of background.
Board of the National Bank of Ukraine in preparation for the introduction of inflation targeting has decided to cease carrying on February 5, 2015 daily FX auctions rejection of the indicative rate.
“Exchange rate will be set by banks on the basis of objective parameters of market supply and demand,” – said the NBU.
According Gontareva, this decision should help bring transparency, greater efficiency and objectivity of price discovery.
Before running auctions in November Gontareva insisted that currency auctions will be held for three to six months.
Also, the National Bank decided to increase the discount rate from 14% to 19.5% on 6 February.
The decision of the regulator adopted to ensure predictable and controlled development of the market situation.
The regulator said that may apply tighter monetary policy.
The main reason for the increase in the discount rate is increasing inflationary risks to be high in the short term.
The decision of the Board taken in accordance with the recommendations of the Committee on Monetary Policy on the analysis of the prospects for the economy and the money market.
National Bank notes that rising interest rates will have minimal effect on activity in the real economy, as lending banks is significantly constrained by the high-risk business environment.
From the size of the discount rate determines the cost of resources provided by NBU as refinancing banks.
The discount rate is the lowest among interest rates National Bank and is a basic indicator of the valuation of financial resources.
In theory, the discount rate can not be lower than the rate of inflation.
National Bank predicts lower GDP by 4-5% in 2015.
“Last year, our forecasts for the expected decline of 6-7%. This year, expect a decline of 4-5%,” – said the director of the Monetary Policy and Economic Analysis Sergey Nikolaichuk.
Nikolaichuk said that the forecast for inflation for this year is 17.2%.
“Due to the measures we use, the National Bank expects slowdown of inflation processes already in the 1st half, while the forecast for the year is 17.2” – he added.
Director of the Department hopes that in 2016 inflation should fall to less than 10%.
“Fall in GDP is primarily structural in nature and caused by supply factors. Although negative GDP gap is very significant – 8-9% of potential GDP, according to experts of the National Bank of Ukraine, actual convergence of GDP to its potential level in the medium term is possible only because of macro-financial stability, which will contribute and tight monetary policy, “- says the National Bank.
National Bank intends to strengthen the powers of its curators banks.
“We will strengthen the powers of the curators, but to enhance their powers we need to strengthen their defense. For example, our curator VAB Bank opened a criminal case,” – said the head of the National Bank.
She recalled that curators are all the banks which issued stabilization loans.
The National Bank and the Fund Deposit Guarantee agreed key parameters of the EFF with the International Monetary Fund.
The head of the National Bank reminded that cooperation program provided for 4 years.
Earlier it was reported that the International Monetary Fund intends to consider the request of Ukraine on the opening of a new multi-year program supported by extended credit (Extended Fund Facility, EFF), to replace the existing framework of stand-by.
Gontareva hopes to the Board of Directors of the International Monetary Fund to grant Ukraine the next tranche of March.
“I hope that tomorrow or the day after tomorrow will be the final version of the memorandum with the IMF. They’ve probably will go, and about 2-3 weeks after their departure will board the IMF,” – said the head of the National Bank.
IMF mission arrived in Ukraine for an official visit January 8.
It was planned that it will work in Kyiv until January 29, but the term was extended visit to 6 February.
According to a leading expert information and analytical center Andrew Shevchishin, the introduction of a single National Bank exchange rate will cause the rise of the dollar on the interbank market to mark 23 hryvnia.
Finance believes that the intention This set market rate related to the work of the IMF mission in Ukraine.
“This is probably one of the requirements of the IMF. The question of the reality of such action (setting a single rate – Ed.) must be considered in the light of strong-willed, and to some extent political step. Since the most likely to receive at the time of a single course of high interbank rate in near 21 -23 USD per dollar instead of the desired 16-17 USD per dollar “- said the expert.
Although economic agents are accustomed to high exchange rate icons to pay the state (for debts, import, weapons, etc.) for this course will be expensive, says economist.
Shevchishin said that the NBU statement on the abolition of the indicative rate has affected the market rate. “In recent days we have seen growth rates expectations. Number of people wanting to buy currency increased revenue and exporters are holding pending rate increase.”
The expert predicts that if in the next few months there will be no additional regulatory restrictions on the NBU can expect a currency freely available, albeit at a higher rate.
However, the hryvnia exchange rate on the interbank market on Thursday continued to decline: quoted at the beginning of trading amounted to 24.5 23,5- hryvnia to the dollar, and extended to 1130 to 23,5- 25 hryvnia per dollar.
Previous historical minimum was recorded on the interbank market on February 4, when the real exchange rate of hryvnia fell to 23.05 UAH per dollar of 22.2 hryvnia per dollar.