REUTERS
The NBU says that excess forex fluctuations in early October were caused by a decrease in the supply of currency.
The National Bank of Ukraine (NBU) has resumed interventions on the interbank forex market this week to sell foreign currency after an almost two-month break and sold US$200 million to prop up the hryvnia, Ukraine's national currency.
Despite the favorable situation on the forex market in general, the hryvnia became weaker in certain periods during the year, the NBU's press service said.
In particular, the weakening of the national currency was recorded in March and late in May, early in June, after which the reverse trend began.
Read alsoUkraine's hryvnia drastically weakens
"If necessary, the National Bank will continue to smooth out excessive [hryvnia] devaluation fluctuations and may resume interventions to buy currency if the reverse trend begins," it said.
The NBU says that excess forex fluctuations in early October were caused by a decrease in the supply of currency with a simultaneous increase in demand under the influence of psychological factors.
"Under a flexible exchange rate regime, forex rate fluctuations are a market reaction to constant changes in the situation in the economy and in the world. After a period of intense fluctuations, the market always finds a point of equilibrium to be followed by a reverse trend," the NBU said.
According to the regulator, the country's international reserves over the past few months were within US$21 billion – US$22 billion and they are sufficient to smooth out current fluctuations on the forex market. At the same time, interventions will still not fix the exchange rate at a certain level, and, as before, the rate will be determined by supply and demand on the forex market.
As UNIAN reported, quotations of the hryvnia against the U.S. dollar on Ukraine's interbank forex market have taken a weakening trend for the third day in a row and were set at UAH 24.90/24.93 per U.S. dollar by the close of trading on Wednesday, which was 27 kopiykas down on the closing level of previous trading.
Experts attribute the recent weakening of the hryvnia to a decline in foreign currency injections by nonresidents into domestic government bonds, but yet they say they see no reason for the drastic weakening of the hryvnia as foreign currency earnings from grain exports remain high.
The National Bank of Ukraine last week – from September 23 to September 27 – bought US$348.2 million on the interbank market and did not sell currency, as was the case in the previous seven weeks.