Overview and Forecast of the Hryvnia Exchange Rate Against Key Currencies by KYT Group Analysts

The National Bank of Ukraine is actively managing the hryvnia exchange rate, increasing foreign exchange interventions to strengthen the currency. This effort has resulted in a stable hryvnia exchange rate, despite a shortage of foreign funds from exporting companies. Between August 3 and September 4, interventions reached $5.915 billion. Demand for foreign currency remains high due to preparations for winter and increased imports of energy equipment.

The conflict with Russia has caused difficulties in grain exports, adding pressure to the foreign exchange market. Ukraine's grain and legume exports for the 2026/27 marketing year are projected at 4.255 million metric tons, down from 5.162 million metric tons in the previous year. The NBU remains the main seller on the interbank foreign exchange market, providing currency needed for imports and grain exports.

The Federal Reserve is expected to raise interest rates by 25 basis points on September 16, with a 90% probability according to market predictions. Gold prices are increasing, with U.S. gold futures rising to $4,409.30 per troy ounce due to inflation data and expectations of a Fed rate hike. The EUR/USD exchange rate has strengthened in September, moving from a peak of 1.1709 USD/EUR in August to around 1.1530 USD/EUR.

Public demand for foreign currency has increased as households convert savings due to stable exchange rates and concerns about hryvnia devaluation and rising inflation. In August, net foreign currency purchases by households rose by 26% to $0.562 billion. Ukraine's international reserves decreased by 5% in August, reaching $48.66 billion, with the NBU attributing this to reduced international financial aid and consistent intervention levels.

Inflation in Ukraine has accelerated to 8.1% year-over-year in August, driven by rising fuel prices and higher administrative costs due to the Russian military aggression and conflicts in the Middle East.