Issue #2 – August 2025
The purpose of this review is to provide an analysis of the current situation on the Ukrainian foreign exchange market and a forecast of the hryvnia exchange rate against key currencies based on the latest data. We analyze current conditions, market dynamics, key influencing factors, and likely scenarios.
Analysis of the current situation on the Ukrainian currency market
In the second half of August, a number of important signals from global markets confirmed that the hryvnia exchange rate increasingly depends not on local factors but on international news and the state of the world’s leading economies and the decisions of their central banks.
Domestic factors remain rather short-term impulses, capable of producing slight spikes but not changing the overall trajectory.
International context
In the United States, July data showed a slowdown in inflation and a cooling of the labor market. This took some pressure off the dollar and increased expectations that the Federal Reserve could cut rates as early as September. The Fed chairman explicitly acknowledged that the policy will have to be reviewed in order not to “overstretch” the economy. As a result, the dollar weakened slightly, and stock markets got a chance for additional optimism.
Given the expectations of the Fed’s actions regarding rate revisions, different scenarios should be considered for key currency pairs.
If the Fed cuts rates in September:
If the Fed leaves the rate unchanged:
The European economy looks sluggish: growth is almost imperceptible, inflation is stable at 2%, and there are no new drivers for the euro. This keeps the currency in a neutral mode – no reason for a breakthrough, but also no prerequisites for a sharp fall.
The UK was the first major economy to cut its interest rate. This signaled to the world that the period of tight monetary policy is coming to an end. If the United States confirms a similar move, the yield differential between currencies will decrease, and the dollar will lose some of its advantage.
Oil and gas prices remained relatively calm in August. This means that there is no additional pressure on the US and European economies due to energy. This is even more of a disadvantage for the euro, as the argument for a tighter ECB policy disappears.
In general, the international backdrop looks like this: The dollar has temporarily lost some of its support, and the euro is hovering on the sidelines.
For the hryvnia, this means relatively stable conditions.
Domestic Ukrainian context
The NBU’s reserves remain high, even after significant interventions and external debt repayments. This creates a safety margin to smooth out exchange rate fluctuations.
In July, inflation eased to 14.1% year-on-year, and the monthly figure showed deflation for the first time in two years. This calmed the market and reduced the “insurance premium” in prices.
External support is coming in as planned: at the end of August, the next tranche of more than €3 billion under the Ukraine Facility program and €1 billion from the proceeds of frozen Russian assets under the G7 Extraordinary Revenue Acceleration for Ukraine (ERA) initiative were disbursed. This is an important stabilizing factor for both the budget and the FX market.
The NBU has also taken steps to liberalize the currency by allowing the repatriation of dividends and expanding hedging instruments. This creates a more predictable environment for business without putting any additional pressure on the exchange rate.
In general, the Ukrainian FX market is entering September in a calm mode: reserves are sufficient, inflation has cooled, and external funds are coming in at the right level.
Internal factors are rather short-term spikes, but the exchange rate will be determined by statements, events, and decisions from Washington and Brussels.
US dollar exchange rate: dynamics and analysis
The general characteristic of market behavior is a smooth decline without sharp impulses
August confirmed the trend of gradual depreciation of the dollar against the hryvnia.
Domestic demand remains restrained: importers are working as planned, households are mainly focused on the euro, and the NBU is keeping the exchange rate in balance without any sudden movements.
Key influencing factors:
Forecast:
Euro exchange rate: dynamics and analysis
General characteristics of market behavior
The end of August showed more volatility for the euro than for the dollar. During the week, the exchange rate initially declined (to lows of ~47.80 UAH/€ on the buy side and ~48.40 UAH/€ on the sell side on August 27-28), but recovered to the level of 48.20-48.60 UAH/€ at the end of the period (August 30-31). It was a technical rebound that was synchronized with movements in the EUR/USD pair on the global market after the Fed chairman’s statement.
Prior to the news from the US, the market had recorded a stabilization in the euro after the previous decline, but there were no drivers for a new trend or significantly different levels from the current target levels.
Key influencing factors
Forecast.
Recommendations: act in ranges, keep liquidity, hedge risks
Key universal ideas:
A universal strategy for everyone – flexibility, division of operations into parts, hedging.
For private investors and savers:
For speculative operations on USD/UAH and EUR/UAH:
This material was prepared by the company’s analysts and reflects their expert, analytical professional judgment. The information presented in this review is for informational purposes only and cannot be considered as a recommendation for action.
The Company and its analysts make no representations and assume no liability for any consequences arising from the use of this information. All information is provided “as is” without any additional warranties of completeness, obligations of timeliness or updates or additions.
Users of this material should make their own risk assessments and informed decisions based on their own evaluation and analysis of the situation from various available sources that they consider to be sufficiently qualified. We recommend that you consult an independent financial advisor before making any investment decisions.
REFERENCE
KYT Group is an international multi-service product FinTech platform that has been successfully operating in the non-banking financial services market for 16 years. One of the company’s flagship activities is currency exchange. KYT Group is one of the largest operators in this segment of the financial market of Ukraine, is included in the list of the largest taxpayers, and is one of the industry leaders in terms of asset growth and equity.
More than 90 branches in 16 major cities of Ukraine are located in convenient locations for customers and have modern equipment for the convenience, security and confidentiality of each transaction.
The company’s activities comply with the regulatory requirements of the NBU. KYT Group adheres to EU standards, having a branch in Poland and planning cross-border expansion to European countries.
https://interfax.com.ua/news/projects/1101270.html
The volume of raw milk supplied for industrial processing in January-June 2025 exceeded 1.8 million tons, which is 10.6% more than in the same period of 2024 and 19.3% more than in the same period of 2023, according to the Ukrainian Dairy Industry Association (UDIA).
The industry association emphasized that the growth rate of raw milk purchases from enterprises in the first half of 2025 decreased to 6% compared to 12.6% in the first half of 2024.
“Raw milk supplies from private farms amounted to less than 94,000 tons,” the UDAU stated.
Hungarian Foreign Minister Péter Szijjártó said that Budapest and Belgrade have agreed to speed up the construction of an oil pipeline between the two countries. The 190 km Hungarian section is planned to be completed by the end of 2027, according to the Serbian Economist Telegram channel.
“We have agreed with Serbian Energy Minister Dubravka Jedovic-Handanovic to speed up the construction of the oil pipeline between Hungary and Serbia. The 190 km Hungarian section should be completed by the end of 2027,” he said on social network X, emphasizing the importance of energy cooperation against the backdrop of Ukraine’s attacks on the Druzhba oil pipeline, which supplies oil to Hungary and Slovakia, among other countries.
Why the project is important for these countries and the entire Balkan region
Increased energy security and diversification of routes
The new oil pipeline will reduce Hungary and Serbia’s dependence on traditional routes, especially in the context of instability caused by damage to Druzhba. This increases the reliability of supplies and reduces energy risks.
Regional energy integration
The construction of infrastructure connecting the Balkan and Central European regions helps strengthen economic ties and stimulates the growth of the energy market in the region.
Strategic independence
Independence from single transit routes provides greater flexibility in times of crisis and allows countries to respond more quickly to external challenges.
Economic impact and infrastructure development
The project creates jobs, contributes to the development of transport and energy infrastructure, and attracts investment for both Hungary and Serbia.
Geopolitical stability in the Balkans
The Balkan region has traditionally been at the crossroads of geopolitical interests. The new route strengthens its strategic importance and helps reduce dependence on external factors.
The Hungarian-Serbian oil pipeline project is not just a technical initiative. It serves as the foundation for a new energy architecture in the region, creating a sustainable, independent, and mutually supportive security system, which is particularly relevant in light of current geopolitical realities.
Source: https://t.me/relocationrs
AgriAcademy, an educational platform for agribusiness professionals, is now accepting registrations for a new course that will help agricultural producers gain up-to-date knowledge about legislative requirements, safe pesticide use, and innovative plant protection technologies, writes SEEDS.
The field of plant protection products is undergoing significant changes, including stricter legislation, safety requirements, new application technologies, and a shift to biological methods. In this environment, Ukrainian agricultural producers must be prepared to adapt to new rules and market expectations.
That is why AgriAcademy is offering a free new certified online course: “Regulation, Safety, and Innovation in the Use of Plant Protection Products” from national and international practitioners and experts.
What will course participants gain?
The approximate duration of the course is 5 hours. After completing the course, you will receive a certificate.
The course program features national and international experts:
Who is this course for?
For farmers, agronomists, consultants, equipment operators – anyone who works with pesticides and wants to reduce risks and increase efficiency.
This is a unique opportunity for Ukrainian farmers to gain knowledge that meets the requirements of the modern market and future regulatory standards. Participation in the course will help you avoid fines, increase the efficiency of your farm, and ensure safe working conditions.
Registration is open on the AgriAcademy website
AgriAcademy is a free online learning platform for agricultural workers and students of agricultural education institutions, launched by the EBRD in December 2022 as part of its food security support program in Ukraine. Its goal is to strengthen the competitiveness and sustainable development of agriculture, which has suffered significant losses due to the war.
Today, the platform offers 28 online courses – over 300 hours of practical training in agronomy, management, technology, processing, storage, and more. Each course includes knowledge testing and certification of participants.
The creation and management of the platform (including course development, training tours, etc.) is supported and funded by the EBRD, as well as:
All certified free courses are available here
Ukraine received a new batch of humanitarian aid from Azerbaijan to restore energy infrastructure damaged during the armed conflict, according to Ukrainian and Azerbaijani press services.
The aid consists of the supply of electrical equipment worth $2 million, approved by a decree of the President of the Republic of Azerbaijan, Ilham Aliyev, dated August 11, 2025, with funds from the presidential reserve fund and the 2025 state budget. The equipment includes generators, transformers, and electrical cables manufactured in Azerbaijan.
The first batch of aid — about 10 trucks sent from the Sumgait Technology Park — contains about 90,000 meters of electrical cables, 25 generators, and seven sets of transformers. They are intended to restore stable power supply in regions of Ukraine destroyed by Russian strikes.
Ukrainian President Volodymyr Zelensky and Azerbaijani President Ilham Aliyev discussed energy cooperation and interaction with the US and European partners during a telephone conversation on August 10. The parties emphasized that the assistance is based on the principles of humanism and partnership enshrined in bilateral agreements, including the 2000 Treaty on Friendship, Cooperation, and Partnership and the 2008 Declaration on Strategic Partnership.
Diplomatic relations between Ukraine and the Republic of Azerbaijan were established on February 6, 1992, when Azerbaijan officially recognized Ukraine’s independence. The Ukrainian Embassy in Baku began operating in 1996, and the Azerbaijani Embassy in Kyiv in 1997.