Evolution of the foreign exchange market in Ukraine
This article involves revealing the establishment of foreign exchange market in the world and its evolution in Ukraine. Establishment and development of the foreign exchange market of Ukraine took place under difficult socio-economic and political conditions. The development of the foreign exchange market in Ukraine is divided into several stages: 1) 1991-1994 years; 2) 1994-1995 years; 3) 1996-1999 years. Since 2000 one observes persistent stabilization in the monetary field, resulted in dynamic development of the foreign exchange market of Ukraine and transactions of commercial banks.
In our research, we defined the essence and importance of foreign exchange market. Due to lasting existence of foreign exchange markets a variety of definitions for this term appeared. Through analyzing the most popular definitions, we have singled out own term: foreign exchange market – is a system of economic relations between the entities on transactions of purchase and sale of currency and currency values, where prices are represented by exchange rates set under the influence of supply and demand.
While analyzing the current state of Ukrainian foreign exchange market particular attention was paid to the proceeding to a floating exchange rate. Ukraine has been maintaining stable exchange rate for a long time, however in 2008, the National Bank of Ukraine (NBU) embarked on a policy of managed floating. This policy remained prior till 2014. In 2014 NBU proceed to a flexible exchange rate in the foreign exchange market and released the UAH from USD dependence. In the first quarter of 2014, official exchange rate against the U.S. dollar fell to 10.9546 UAH/USD.
Upon the investigation of main problems of Ukrainian foreign exchange market we determined its main tendencies.
The following conclusions was made on the base of the study: the prospects for the full release of Ukraine on the international foreign exchange market is impossible without taking measures at the level of households, businesses and industries. A lot depends on the economy, industry and finance. The lack of competitiveness and the illiquidity of the domestic currency is main obstacle to the integration of Ukraine into the international foreign exchange market. Current political crisis in Ukraine also had a negative impact onto the foreign exchange market. Therefore it is difficult to make any specific predictions regarding the development of the foreign exchange market in Ukraine before of resolve the political situation in the country.
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Keywords: foreign exchange market, foreign exchange operations, currency, currency regulation, exchange rate, international reserves, foreign exchange intervention |
MACROECONOMICS
Duba Oleksandr
PhD, Àssociate Professor
Zmiichuk Anna
candidate for PhD
Myronenko Hrygory
postgraduate, SHEI «Kyiv National Economic University named after Vadym Hetman»
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