In February, the supply of foreign currency in Ukraine was strengthened by three main factors.
In February, the situation in the foreign exchange market of Ukraine improved significantly, and one of the reasons was the cessation of financing the state budget deficit through the issuance of the hryvnia by the National Bank. This was stated in the macroeconomic and monetary review of the NBU, published on Tuesday, March 7.
It is indicated that in February the supply of foreign currency was boosted both by the seasonal increase in its sales, mainly by agribusiness enterprises to prepare for the sowing campaign, and by the saturation of the market due to the decrease in demand due to the possibility of buying of non-cash foreign currency with subsequent placement in a deposit.
“In addition, the lack of monetization of the budget deficit continues to positively influence the foreign exchange market,” said the National Bank.
Recall that by the end of 2022, the NBU has “printed” 400 billion hryvnias. This amount is comparable to financial aid from the United States (UAH 450 billion). The National Bank believes that this is the main reason for the devaluation of the hryvnia.
At the same time, it is reported that the NBU is reducing sales of foreign currency in the interbank market for four weeks.
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Source: korrespondent
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