Adjusting the fixed exchange rate by 25% does not mean a corresponding increase in prices, the regulator assured.
The National Bank’s decision to raise the official exchange rate by 25% to 36.57 hryvnia per dollar will have only a limited impact on inflation. This was reported by the press service of the regulator on Friday, July 22.
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“This decision will have only a limited impact on inflation – approximately 2-3 percentage points on the annual rate of price growth. Of these, 0.6-0.8 percentage points which are direct and secondary effects from rising fuel prices Impact Changes in the level of exchange rate adjustment for inflation have been taken into account in the National Bank’s new forecast.
It is argued that a 25% adjustment in the fixed exchange rate does not mean a corresponding increase in prices. The National Bank recalled that the current growth of consumer prices is mainly based not on the exchange rate factor, but on other factors.
“It is high prices in the world, record inflation in the world and the consequences of the war. Among them: disruption of supply chains, less supply of some products, high production costs for businesses, physical destruction of production facilities and infrastructure, and temporary work. of some territories of our country,” explained the regulator.
In addition, the exchange rate at the level of 29.25 hryvnia per dollar, due to changes in the internal and external situation since its introduction, has gradually lost its role as an anchor in the economy.
“This means that even before the change in the fixing level of the official exchange rate, the price of imported goods already includes the higher exchange rate of the hryvnia against the US dollar. As in addition, part of the imports are bought at the expense of cash, the exchange rate is also higher than the official,” believes the NBU.
In addition, in conditions of low consumer demand due to the fall in the population’s incomes caused by the war, importers and traders can only partially transfer the increase in the value of imported products to prices.
“Instead, they will be forced to adjust their own margins,” the National Bank is convinced.
It was emphasized that in the basket of consumer inflation, the weight of imported goods is approximately one third.
“Even for these goods, pricing is not completely determined by the exchange rate. At the same time, the pricing of domestically produced goods and services is less dependent on the exchange rate factor,” end of the NBU.
Recall that on July 21, for the first time since the beginning of the war, the NBU raised the dollar against the Hryvnia – immediately by 25% to UAH 36.57 / dollar. Correspondent.net Imagine what awaits Ukrainians after such a decision by the financial regulator.
Also, the National Bank called the terms of stabilization of the dollar after its sharp increase.
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Source: korrespondent
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