NBU Sets Hryvnia at 38.2664 UAH/USD

Quick Look

• The National Bank of Ukraine (NBU) raised the hryvnia rate to 38.2664 UAH/USD on March 7.
• This adjustment follows a decrease on March 6 to 38.3943 UAH/USD.
• Since July 21, the hryvnia experienced a notable 25% adjustment to 36.5686 UAH/USD.
• The NBU has removed restrictions for currency transactions and implemented managed exchange rate flexibility.

The National Bank of Ukraine’s recent adjustment of the official hryvnia exchange rate to 38.2664 UAH/USD marks a pivotal moment in the country’s financial landscape. This decision, a part of the bank’s broader economic strategy, underscores efforts to maintain currency stability and react dynamically to market conditions. The adjustment comes after a slight decrease the previous day, showcasing the NBU’s active role in managing the hryvnia’s value against the dollar.

The significance of this move can be traced back to July 21, when the NBU made a substantial 25% adjustment. Since then, the bank has continued to refine its approach, signalling a commitment to stabilising the national currency and adapting to the evolving economic environment.

Enhancing Currency Flexibility and Public Access

In a notable policy shift on August 6, 2022, the NBU lifted restrictions previously mandating banks and non-banking institutions to purchase cash currency from the populace at or above the official rate. This change, aimed at increasing currency accessibility for the public, permits banks to sell more foreign currency, thereby enhancing market fluidity and flexibility.

The move towards managed exchange rate flexibility, initiated on October 3, further exemplifies the NBU’s strategy to navigate economic challenges while ensuring the hryvnia’s stability. This approach allows the bank to respond effectively to currency market shifts, safeguarding the economy from potential volatilities.

Vigilance Against Currency Counterfeiting

The NBU’s vigilant monitoring of the hryvnia has been effective in combating currency counterfeiting. By the end of 2023, they detected a notably low rate of counterfeit banknotes. Specifically, there were approximately 2.1 counterfeits for every 1 million authentic banknotes. This figure shows a slight improvement compared to 2022’s data. Consequently, it emphasises the success of the NBU’s oversight efforts.

Moreover, the NBU paid special attention to older series banknotes. They discovered that the majority of counterfeits were in denominations of UAH 100, UAH 200, and UAH 500. Interestingly, the incidence of counterfeit UAH 200 banknotes rose. This increase suggests counterfeiters targeted these denominations. Nevertheless, the NBU’s proactive actions have helped maintain the national currency’s integrity. Therefore, this underscores the bank’s strong commitment to ensuring financial security.

Furthermore, the National Bank of Ukraine has recently taken steps that showcase a strategic approach to currency management and economic resilience. The bank made thoughtful adjustments to the exchange rate. Additionally, it removed certain transaction restrictions. It also remained vigilant against counterfeiting. Through these actions, the NBU has shown its unwavering dedication to securing Ukraine’s financial stability.