I’m worried about the hryvnia - and you should be too - Opinion - News - Ukraine Business Online

I’m worried about the hryvnia - and you should be too - Opinion - News - Ukraine Business Online:

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For the last four years, Ukrainians have been able to count on at least one near constant - the spending power of their hryvnias. It’s been locked in at roughly UAH 8.1/USD, with seemingly as much logic behind it as the popular grade-school defense “because I said so.” The stability has been calming on many levels and for many people, but has always struck some (myself included) as alarming.

An apt analogy might be to the fictional hare - with Ukraine doing everything it can to prop up the hrvynia’s peg to the US dollar, while watching other more venerable regional currencies taking brief respites and being allowed to depreciate, while dropping a snide “suckers” as they race along full tilt. But now the others, the tortoises in our tale, including Russia with the ruble and Poland with the zloty, have preserved their resources and their currencies are in fact even stronger than four years ago. Meanwhile, the fuel that has supported the hryvnia all this time has dwindled - the National Bank of Ukraine’s precious stockpile of currency reserves."

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