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Hryvnia strengthened due to labor migrants and high crop yield, - IMF

Source : 112 Ukraine

It has a positive effect on consumers of imported goods, but it also has a negative impact on exporters
15:15, 9 January 2020

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Money transfers to Ukraine from labor migrants, record harvests, as well as increased demand for national bonds could be the main reasons for strengthening of the hryvnia. Representative of the International Monetary Fund (IMF) in Ukraine Gosta Ljungman talked about it in an interview with the Espresso TV Channel.

"It is difficult to determine the main factor that led to this. Yes, there is a continuation of a rather significant inflow of funds from Ukrainians who are in search of money abroad. The prices for traditional Ukrainian export goods are high while the prices of Ukrainian imports - for the same gas - have decreased,” Ljungman stated.

He also noted that over the past two years, Ukrainian farmers had been collecting a record grain harvest, whose export earnings had increased the country's currency supply, reducing its exchange rate. He also added that the government had offered attractive rates on national bonds, which had also increased the demand for these securities.

Related: Ukraine-IMF cooperation: Myths and reality

The IMF representative in Ukraine said that the hryvnia strengthening had a positive impact on consumers for whom imported goods are cheaper. At the same time, exporters are suffering from this phenomenon because their revenue falls.

As we reported earlier, the economy may grow by 3.7% in 2020. This was stated by Minister of Economic Development, Trade, and Agriculture of Ukraine Tymofiy Milovanov during a briefing broadcasted on 112 Ukraine TV Channel.

At the same time, according to the forecasts of the Ministry of Economy, by the end of 2020, the inflation rate can decrease to 5.5%.

Related: Ukraine’s economy can reach level of Poland in 15 years, - business ombudsman
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