Page 47 - UKRRptJul20

7.0​ FX
The hryvnia traded at 26.70 to the dollar at the start of June, 5.5% stronger than its crisis low of 28.27 on March 26​. In May, Ukrainians sold $909mn through the banking system, or $49mn more in foreign currency than they bought, the central bank reports.
Labour remittances, Ukraine’s second largest foreign exchange earner after food exports, dropped 11.2% y/y in April,​ reports the National Bank of Ukraine. Last year’s remittances of at least $12bn represent almost 10% of GDP and are about six times foreign direct investment, according to a new European Commission report, The Impact of labour Migration on the Ukrainian Economy.
IMF includes UAH30/$1 average exchange rate in forecasts for Ukraine for 2020. ​The nominal gross domestic product of Ukraine in 2020 will decline to UAH3.908 trillion, or to $130.3bn, which brings to the average annual rate of UAH30/$1, according to the IMF’s new Stand-By Arrangement analysis.
The IMF recalled that in 2019 Ukraine's GDP grew to UAH3.975 trillion from UAH3.561 trillion in 2018, and in US dollars to $154.7bn from $130.9bn, while the average annual hryvnia exchange rate strengthened to UAH25.70/$1 from UAH27.20/$1.
According to the IMF's estimates, next year the average annual hryvnia exchange rate will strengthen to UAH28.90/$1, and in 2022 - to UAH28.60/$1, after, which it will be stable at UAH28.70/$1 for three years.
Since the beginning of this year, according to the National Bank, the average hryvnia exchange rate has been about UAH25.90/$1.
47​ UKRAINE Country Report​ July 2020 ​ ​www.intellinews.com