From 9:00 a.m. on July 21, 2022, the National Bank adjusted the official exchange rate of the hryvnia to the US dollar by 25% to UAH 36.5686 per $1. The regulator explains this decision by the change in the fundamental characteristics of Ukraine’s economy during the war and the strengthening of the US dollar against other currencies. In addition, the fixed exchange rate at the level of UAH 29 per US dollar was actively criticized by exporters and IT specialists who receive salaries abroad in foreign currency.
The NBU now believes that such a step will increase the competitiveness of Ukrainian manufacturers, bring exchange rates closer to different groups of businesses and the population, and also support the stability of the economy in wartime conditions.
According to the National Bank’s estimates, the correction of the exchange rate will increase the inflow and, accordingly, the sale of foreign exchange earnings by exporters, minimize the speculative component of the behavior of market participants and make it possible to stabilize the exchange rate expectations.
As noted by the National Bank of Ukraine, the correction of the official exchange rate of the hryvnia will have only a limited effect on the acceleration of price growth, caused in recent months primarily by the consequences of the war on the supply of goods and services and the cost of logistics, as well as the dynamics of prices on global commodity markets.
In addition, as of today, the National Bank has allowed banks to sell non-cash currency to citizens with subsequent placement on deposit for a period of three calendar months without the right of early termination within the monthly limit of UAH 50,000 (equivalent). This will create an alternative to investing in cash currency, which will reduce demand for it and pressure on the exchange rate in the cash segment of the foreign exchange market.
In addition, from July 21:
- Citizens will still be able to withdraw UAH 50,000 (equivalent) per month from hryvnia payment cards abroad. At the same time, the limit for cash withdrawals from hryvnia payment cards abroad has been changed from monthly to weekly: UAH 12.5 thousand (equivalent) for seven calendar days;
- The monthly limit on P2P transfers of citizens abroad from hryvnia payment cards of Ukrainian banks has been reduced from UAH 100,000 (equivalent) to UAH 30,000 (equivalent);
- A monthly limit has been established for payments abroad using hryvnia payment cards in the amount of 100,000 hryvnias (equivalent) from all client bank accounts opened in the national currency.