REUTERS
"We cannot focus on the short-term situation and afford 'one-time' solutions that do not address the core of the problem," Smolii said.
Governor of the National Bank of Ukraine (NBU), Yakiv Smolii, says NBU has abandoned the fixed exchange rate of the national currency, the hryvnia: now it is being determined by the market.
"We have long deviated from the fixed rate. The currency rate is now determined rather by the market than by the National Bank. The government uses certain technical and accounting indicators in budgeting, but market conditions may not be conducive for their implementation. If imports and exports today form a different rate than that set in the budget, we cannot interfere in the process," he told the Ukrainian online newspaper ZN.ua.
"We only watch out so that there are no major fluctuations because they increase uncertainty in the economy and prevent businesses and the population from taking long-term decisions. That is the objectivity," the NBU Governor added.
According to Smolii, the regulator systemically buys and sells currency on the market. Thus, more than US$1.2 billion in international reserves has been purchased on the interbank foreign exchange market since the beginning of the year.
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"We are roughly guided by the currency supply and demand. We assume we must increase reserves, but at the same time, we should not prevent the market from determining the hryvnia rate, which corresponds to the state of our economy. We have already seen that keeping the hryvnia rate at an artificial level, divorced from economic realities, leads to accumulation of imbalances and crises," he said.
"The NBU can settle everything by putting pressure on the hryvnia exchange rate, and thus satisfy the prime minister. But why? Such decision will not prevent us from the situation repeating after a certain time. The NBU management, if we manage to retain the regulator's independence, should come for seven years and work from a long-term perspective. We cannot focus on the short-term situation and afford 'one-time' solutions that do not address the core of the problem," Smolii summed up.
As UNIAN reported earlier, Ukraine was set to make peak payments on state debt in 2019-2022.