Interfax: Ukraine cbank head says ready to move forex

World

Ukraine’s central bank is ready to change the hryvnia’s official rate of 5.05 to the dollar as well as its market rate, the bank’s head, Volodymyr Stelmakh, was quoted as saying on Thursday.

Stelmakh, speaking to Interfax Ukraine news agency, did not say which way the bank may move the rate, but it has let the hryvnia strengthen beyond its upper limit to the dollar in recent weeks without intervening. “There clearly will be a move, both on the official and the market rate. If supply and demand on the market really shows, that we need to move, then we will have to act accordingly,” Stelmakh said.

The central bank has kept the hryvnia within a corridor of 4.95-5.25 and until recently had been intervening to keep it within an even tighter band of 5.00-5.06. The official rate of 5.05 has been maintained since August 2005.

Stelmakh talked about changing the hryvnia’s rate in conjunction with attempts to curb inflation, which reached 26% year-on-year in March. That was a further indication that the bank might be thinking of allowing the hryvnia to strengthen. “Domestic prices are important for us, because we have higher imports than exports. Setting an optimal rate will play a big role for domestic prices -- for their stabilization and reduction...,” he said. He also said the current account deficit, which in Ukraine has widened due to higher gas import prices, should not automatically rule out revaluation.

The head of the bank’s council, however, said the bank was looking at widening the corridor to 4.9-5.3 to the dollar, rather than revaluing the hryvnia. “We want to be clear - both the lower and higher reaches will be widened,” Interfax Ukraine quoted Petro Poroshenko as saying. (Reuters)

ADVERTISEMENT

Industries lose billions on counterfeit products Analysis

Industries lose billions on counterfeit products

Parl't to vote on groundwork for commercial accommodation ra... Parliament

Parl't to vote on groundwork for commercial accommodation ra...

Duncan Graham reelected as BCCH president Appointments

Duncan Graham reelected as BCCH president

Budapest re-launches airport shuttle bus City

Budapest re-launches airport shuttle bus

SUPPORT THE BUDAPEST BUSINESS JOURNAL

Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.