Hryvnia decline continues in Ukraine

12:04, 03 December 2008
Ukraine
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The hryvnia’s value dropped to 7.3850/7.5150 hryvnias vs the U.S. dollar

The hryvnia’s value dropped to 7.3850/7.5150 hryvnias vs the U.S. dollar Wednesday at the inter-bank market, according to InterBusinessConsulting financial company. The hryvnia’s exhamge rate vs the Russian rouble makes 0.2575/0.2675 hryvnias, and vs the euro – 9.3695/9.5405.

The central bank did not intervene the market on Tuesday.

The decline comes days after a warning from President Viktor Yushchenko that the hryvnia’s further slide may force the president to shake up the top management of the NBU.

As UNIAN reported earlier, the c.bank claimed Tuesday it was ready to make a currency intervention on December 3 to sell U.S. dollars at a currency auction.

According to the Ukrainian Journal, the NBU on Tuesday scrambled to remove last remaining restrictions to market quotation of the hryvnia on the cash market in a bid to let commercial banks find equilibrium as the hryvnia’s exchange rate against the dollar fell.

The NBU allowed commercial bank to quote exchange rates that they find adequate, canceling regulation that has been restricting the banks from deviating by more than 1.5% from the official rate.

The restriction led to the fact that many banks would obey by quoting the proper exchange rates, but in fact the banks would simply not sell dollars at all. This made it virtually impossible to buy hard currency.

 

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