The foreign exchange market remained under control thanks to a sufficient number of interventions, the NBU assured.
Significant budget spending by the end of 2023 and increased uncertainty in receiving external financing led to an increase in demand for foreign currency in Ukraine. This is stated in the macroeconomic and monetary review of the NBU (January 2024), published the previous day.
“Demand for foreign currency from importers of food and household goods, fuel, and electricity also increased,” the analysis said.
According to the regulator, spending reached “record unprecedented levels” in December. Overall, expenses increased by around 50% YoY in 2023, despite a significant base of comparison last year.
The main areas of expenditure should be in the areas of defense and security and social security. Capital expenditures are likely to pick up in December after some slowdown in the previous month. This may be due to the implementation of infrastructure projects and repairs as well as compensation to citizens for damaged properties, the National Bank added.
As noted in the analysis, except for recent days, the difference between the cash and the official dollar exchange rate has decreased throughout December, mainly due to the lifting of restrictions on banks and financial institutions not a bank selling cash foreign currency to the public.
Under the influence of these factors, the NBU increased its interventions in the interbank market to $3.6 billion.
“A sufficient volume of interventions and positive returns on hryvnia instruments in real terms ensures the control of the foreign exchange market,” assured the NBU.
We remind you that this week the official dollar exchange rate has updated its historical record. And Ukrainians in December bought a record amount of money for 11 years.
Source: korrespondent
I’m Liza Grey, an experienced news writer and author at the Buna Times. I specialize in writing about economic issues, with a focus on uncovering stories that have a positive impact on society. With over seven years of experience in the news industry, I am highly knowledgeable about current events and the ways in which they affect our daily lives.