NBU expects moderate exchange rate volatility this fall

"Reports have been circulating recently that following a seasonal pattern, the hryvnia exchange rate is expected to depreciate sharply this fall. The NBU does not share these concerns," he said at a press briefing on monetary policy Sept. 13.

"It is true that the FX market is always subject to seasonality. However, with a floating exchange rate regime in place, the development of the FX market and implementation of reforms in other sectors enable the effect of seasonality to be mitigated."

Read alsoIMF names conditions for Ukraine to receive fifth loan tranche"As a result, the role of factors that are typically in play in the fall has decreased significantly. For instance, Naftogaz NJSC receives sufficient FX earnings and thus exerts no pressure on the FX market through one-off FX purchases. The Ministry of Finance of Ukraine ensures that the settlement of VAT refund claims is more or less equally distributed in time rather than making large one-off payments at the end of the month. Furthermore, FX revenues from agricultural exports typically tend to increase in the fall," Churii said.

He added that "one should not forget that the NBU continues to retain its presence in the FX market to smooth out excessive exchange rate volatility driven by situational factors if needed."