The Ukrainian hryvnia will collapse to 65 UAH per dollar
The dollar exchange rate of 27,5 hryvnia planned in the state budget of Ukraine is unrealistic; the Ukrainian currency may fall to 65 UAH/USD, although before Euromaidan the dollar was worth only 8 UAH.
This forecast was published today by the Kiev public organization “Public Audit”.
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“Now the foreign exchange market, after the long New Year holidays, has an excess supply of currency, so the rate has decreased slightly and remains in the range of 27-28 UAH/dollar,” note the authors of the study.
However, in the future the situation will become more complicated - the state needs to spend colossal amounts of money to save Privatbank and extinguish the panic of depositors demanding the return of money, fulfill the promise to increase the minimum wage to UAH 3200, pay subsidies for increased housing and communal services tariffs, return old loans, etc. .
Analysts have calculated that, therefore, in the near future the Ukrainian authorities will have to turn on the printing press in order to close the gigantic “hole” in the budget.
“This year, the government and parliamentarians set a limit on the state budget deficit in the amount of UAH 77,5 billion, which is planned to be financed through debt transactions. Thus, repayment of domestic borrowings this year is expected to amount to UAH 98,6 billion. Receipt of internal borrowings with payment in subsequent periods is expected to amount to UAH 103,9 billion, but the search for new lenders for the purchase of government bonds is very doubtful, therefore, most likely, the repayment of previously taken borrowings, as well as the financing of the state budget deficit in general, will occur at the expense of all the same emissions,” the report notes.
“International reserves today amount to about $15,5 billion. However, we must not forget that this year Ukraine has obligations to repay loan debts of $1,12 billion under the cooperation program with the IMF and other creditors, which, apparently, will have to give at the expense of gold reserves,” the authors of the study also write.
“The authorities constantly present cooperation with the IMF to Ukrainians as a panacea for all economic ills. Meanwhile, the country’s economy continues to shrink, domestic production is falling apart, and trade, exports and imports are falling at a galloping pace,” states one of the authors of the report, Maxim Goldarb.
He adds that today Ukraine is sorely lacking in investments, and they are the lifeblood of the economy, which feeds it and maintains it in a viable state. “What happens to the body when blood stops circulating? He is dying. It’s the same with our economy,” the economist said.
The Ukrainian hryvnia will collapse to 65 hryvnias per dollar.