Analysis of the Current Situation
In recent weeks, the foreign exchange market has maintained a fragile stability, primarily supported by external factors affecting key global currencies. Currently, there are no strong economic or psychological drivers from internal factors that could impact the established stability of the national currency against major international currencies.
One significant factor for ensuring long-term support for economic and currency stability in Ukraine will be the G7 countries' agreed program of financing amounting to $50 billion. This decision adds to the list of stabilizing factors, which currently outnumber the risk factors affecting exchange rate stability.
However, there are potential drivers of currency market destabilization due to increased demand among the public and businesses for currency or other assets for protection or settlements, the potential of which is currently difficult to assess until the first statistically significant signals emerge.
Dollar Exchange Rate Forecast
As we previously predicted, the dollar exchange rate in October remains relatively stable, with minor fluctuations in the range of 41.11–41.5 UAH/$. Over the past 30 days, the rate has fluctuated within these limits, and we currently do not see any factors that could change this situation in the short term.
The spreads between the buying and selling rates of the dollar remain moderate, with no significant deviations from the official rate set by the National Bank of Ukraine, indicating that a market equilibrium has been achieved between the official and real exchange rates recorded by market operators.
Short-term forecast: We expect that in the coming months, the exchange rate of the hryvnia against the dollar will remain stable within the aforementioned limits – up to 42 UAH/$, provided that current conditions persist.
Medium-term forecast: By the end of 2024, external factors such as the monetary policy of the US Federal Reserve and its decisions regarding interest rates will influence the dollar exchange rate, while internal factors will include the approval of Ukraine's state budget for 2025. The national currency's exchange rate against the dollar may decrease to 43 UAH/$, and the projected exchange rate in the state budget for 2025 of 45 UAH/$ allows for fluctuations in the range of 44-46 UAH/$.