The hryvnia exchange rate on the interbank market is strengthening, but the economic downturn is getting worse

< span style="font-size:14px;" > on Friday, the hryvnia exchange rate on the interbank market from the morning 27.60/27.62 UAH/. strengthened to 27.53/27.55 UAH/. against the background of a decrease in demand for foreign currency due to a seasonal reduction in purchases of gas and petroleum products and an increase in offers due to an increase in revenues from the activation of agricultural exports.

< span style="font-size:14px;" > however, the economic downturn, confirmed by macroeconomic indicators, may soon increase exchange rate fluctuations. According to the state statistics service, Ukraine's real GDP in the first quarter of this year decreased by 2% compared to the corresponding indicator of 2020.

< span style="font-size:14px;">due to the reduction in exports and increased imports of services, the deficit of Ukraine's foreign trade balance in Q1 2021 increased from кв 246.6 million to. 1.049 billion compared to Q1 2020. Thus, imports of goods and services increased by 12.9% to.16.83 billion, and their exports – by 7.6% to. 15.8 billion. Exports of goods increased to 112% or. 13.707 billion compared to Q1 2020, while their imports increased to 111% or. 15.022 billion. The negative balance was 1 1,315. 1 million, while in Q1 2020 it was 1 1,296. 4 million. Exports of services decreased to 85.6% or кв 2,417. 5 million, while their imports increased to 1 131.6% or 1 1,814. 3 million, and the positive balance was 6 603.2 million compared to кв 1,445. 7 million in Q1 2020. the Export Import coverage ratio increased from 0.90 to 0.91 compared to Q1 2020.

< span style="font-size:14px;" > according to the State Statistics Service, the deficit of Ukraine's foreign trade balance in 2020 amounted to 2 255.5 million compared to. 3.689 billion in 2019. the import – export coverage ratio was 1.33 (in the first quarter of 2020-2.05).

< span style="font-size:14px;" > at the auction on May 18, the Ministry of Finance plans to increase the volume of borrowings through government bonds, since during May 20-22 it must repay two Hryvnia issues of government bonds totaling UAH 13 billion plus interest, as well as interest on 9 Hryvnia issues with a nominal yield of 6% to 16.42%.

< span style="font-size:14px;">therefore, we should expect that this week the dollar exchange rate on the interbank market will remain under pressure from an increase in currency receipts from non-residents who will buy government bonds.