The National Bank of Ukraine considers it inappropriate to strengthen the hryvnia now.
The National Bank of Ukraine's executive director of bank supervision, Oleksandr Kireiev, announced this to journalists.
"We can strengthen the hryvnia, but we have a negative trade balance, anyway. To provoke an even larger gap? But will the hryvnia hold up at 5.05 [UAH/USD] later? I am not sure. Therefore, it is a very dangerous thing to start shaking the tree at a time of economic uncertainty," he said.
He stressed that the US dollar is the currency of a country with the world's most powerful economy.
"The dollar is backed by the huge, powerful economy of the United States. Therefore, this currency that is the basis for settlement for petroleum products in the world should not be ignored. When major traders stop using this currency in international settlements, then one can speak of abandoning [the pegging of the hryvnia to the dollar]," he said.
Kireiev also said that the rate of inflation in Ukraine is significantly higher than the rate in the United States and that this did not provide grounds for strengthening the dollar at this time.
"Let s compare the pace of inflation in the United States and Ukraine. Do we have any grounds to say that the hryvnia is stronger than the dollar?" he said.
As Ukrainian News earlier reported, the National Bank of Ukraine strengthened the hryvnia by 14 kopecks to 5.0500 UAH/USD on April 21, 2005, and has preserved this exchange rate since then.
Press conference with Situations Modeling Agency entitled "Earlier Kharkiv elections: possible consequences and prospects for participants of electoral process"
