The hryvnia to dollar exchange rate set at 40.7 in Ukraine’s state budget is merely a technical benchmark and should not be interpreted as a forecast or expectation of the future exchange rate. The National Bank of Ukraine stated this, reports Baltimore Chronicle with reference to Youtube.
The NBU clarified that the budget exchange rate is used solely for calculation purposes — for example, in planning state budget revenues and expenditures as well as assessing macroeconomic indicators. The actual exchange rate is determined by the foreign exchange market, and its formation depends on the balance of supply and demand, not on budget figures.
NBU Deputy Governor Serhii Nikolaychuk emphasized that the budget figure does not reflect the full flexibility inherent in market exchange rate formation and is neither a fixed point nor a target for the central bank.
Currently, the market exchange rate is significantly lower than the one set in the budget, and this gap has persisted for a long time. Nikolaychuk highlighted that unlike the fixed exchange rate system, which was in place until summer 2022, the current rate is formed with market participation and gradual liberalization of currency policy.
The Ministry of Finance also confirmed that the rate of 40.7 UAH/USD is not a policy target for the NBU or the interbank market. It is calculated based on a macroeconomic forecast developed by the Ministry of Economy and serves only as a tool for budgetary calculations.
The NBU stressed that forecasting the exchange rate under full-scale war conditions is difficult, so the budget figure is more of a technical parameter than an actual expectation.
Earlier we wrote that NBU explains when Ukraine can switch to the euro.