USD/UAH Outlook:
Slightly positive, but likely to move sideways as the USD trades above its recent average, but lacks a clear driver for further upward movement.
Key drivers:
• Rate gap: The Federal Reserve has paused interest rate cuts, maintaining its rate while the National Bank of Ukraine has intervened to stabilize the UAH.
• Risk/commodities: Oil prices remain below average, potentially reducing pressure on both currencies, as lower oil costs can benefit Ukraine's economy.
• One macro factor: Increased international financial assistance to Ukraine has strengthened the NBU's reserves, providing more stability to the hryvnia exchange rate.
Range:
Movement is expected to hold within the established range, with fluctuations influenced by geopolitical tensions and economic data.
What could change it:
• Upside risk: A potential improvement in U.S. economic data could strengthen the dollar and push the rate higher.
• Downside risk: Ongoing geopolitical tensions might weaken the dollar further, affecting the exchange rate negatively.
