By KYIV. Dec 5 (Interfax-Ukraine) – The hryvnia will weaken next year, but very slightly: the average exchange rate for the year is expected to be UAH 37.30/$1 compared to UAH 36.50/$1 this year, Chief Economist of the Dragon Capital investment company Olena Bilan gave this forecast at RAU Summit 2023 in Kyiv on Tuesday.
“I am quite optimistic about the exchange rate forecast for next year: …there will be such a slight weakening to UAH 37.30/$1 on average for the year. In principle, I see that now, the consensus among analysts, the average forecast, is moving towards ours: now the latest data is UAH 37.90/$1 on average for the year,” Bilan said.
The economist said that the condition for such a positive assessment is the receipt of international assistance in the amounts planned in the state budget.
“If everything goes OK next year with international assistance, and we expect that it will. We expect that our partners will provide $40 billion in international direct support to the budget… And this will allow us to keep the situation on the foreign exchange market under control,” the representative of Dragon Capital said.
Bilan believes that such external support will lead to an increase in the gold and foreign exchange reserves of the National Bank of Ukraine (NBU), giving it the opportunity to both further weaken currency restrictions and “allow the hryvnia to move in one direction or the other more than it is now.”
As reported, at the end of October, Dragon Capital announced an improvement in the forecast for the hryvnia exchange rate against the U.S. dollar. The company at that time expected it to be UAH 37/$1 by the end of this year (compared to the previous forecast of UAH 37.50/$1) and UAH 39/$1 by the end of 2024 (compared to UAH 41/$1), “since, with the ongoing war, exchange rate stability will remain a key goal for the National Bank, despite the recent transition to a managed flexible exchange rate.”
