Issue #2 – January 2026
The purpose of this review is to provide an analysis of the current situation on the Ukrainian currency 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 currency market
International context
The main event of the second half of January 2026 was the expected meeting of the Federal Reserve Committee, which considered the level of the key policy rate. As a result, as expected by the markets, the Fed left the benchmark interest rate unchanged, and the federal funds rate remains in the current range of 3.5% to 3.75%. The last meeting of the Fed Committee actually marked the beginning of a pause after three consecutive rate cuts in 2025. Currently, the situation in the US economy does not look pessimistic, as GDP growth in the third quarter reached 4.4%, which significantly exceeded forecasts. Nevertheless, the Fed needs to keep the situation under control, as worrisome trends could become “black swans” for the US economy in 2026. We are talking about a weakening labor market and an inflation rate that exceeds the 2% target.
As for the EUR/USD pair, the dollar continued to fall against the euro in January and even reached the level of 1.2038 by the end of the month, although later there was a slight pullback to 1.1930. Thus, analysts noted that the US dollar fell to its lowest level in four years at the end of January 2026, and this happened after US President Donald Trump dismissed fears of a fall in the US currency. When asked by journalists whether he was concerned about the currency’s decline, he replied: “I think the value of the dollar – look at the business we do. The dollar is doing great.” This statement sent the dollar tumbling, as it caused investors to rush toward traditional investment havens that include gold and the Swiss franc.
While the dollar is losing, the euro is strengthening. The single European currency has strengthened by 15% over the past year. Among the reasons are the instability of Donald Trump’s policies, the Trump administration’s economic decisions on tariffs, and threats to further US economic growth. Of course, Donald Trump’s latest statements on Greenland also add fuel to the fire of the dollar’s decline.
The EU itself is not too happy about the strong euro, as it makes European exports less competitive. Thus, the current trend of strengthening the euro is unlikely to be beneficial for the development of the EU economy. Some experts even predict that the eurozone’s GDP will be about 0.2% lower by the end of the year if the euro/dollar exchange rate remains at the current level, rather than at about $1.16, which has been the benchmark since the EU-US trade agreement in late July. As for whether the European Central Bank will take any action, no one is sure yet. The next ECB meeting in early February should provide some guidance and show whether Europe is ready to change the vector of monetary policy.
Domestic Ukrainian context
In January, the Ukrainian currency market was really stormy, and devaluation processes accelerated, with a particular surge in the middle of the month, when the official exchange rate reached UAH 43.39 per dollar. However, the NBU’s interventions played an important role in reversing the fluctuations, and as of January 30, the official exchange rate was set at UAH 42.84 per dollar.
In January, the NBU continued its policy of exchange rate flexibility, but increased interventions to cool down the high demand for foreign currency. In the first three weeks of January, the NBU sold USD 2.678 billion on the market, with the largest amount (over USD 1.06 billion) in the third week of the month. However, the peak level of demand observed in December, when the NBU sold more than $4.65 billion on the market, was not observed in January.
An important decision in January was to cut the NBU’s key policy rate. The Board of the National Bank of Ukraine decided to start a cycle of interest rate easing, and the rate was cut from 15.5% to 15% starting January 30, 2026. According to the NBU, this is consistent with bringing inflation to the 5% target on the policy horizon and will support the economy at the same time. In addition, the NBU informed that in December, both consumer and core inflation slowed to 8% year-on-year. They say that the annual growth rate of consumer prices also declined in January, but inflation expectations remained relatively high. According to the NBU’s forecast, inflation will decline to 6% at the end of 2027, and to the target of 5% in 2028.
As for foreign aid, the NBU says that the expected amount of foreign aid will be enough to finance the budget deficit without issuing new debt and to keep international reserves at a sufficient level to maintain the stability of the foreign exchange market. The NBU said in a statement that the EU Council has decided to allocate EUR 90 billion to Ukraine in 2026 and 2027, and that support for Ukraine will continue under the current ERA Loans mechanism. The NBU’s updated forecast suggests that international reserves will amount to USD 65 billion by the end of 2016. At the end of 2026, international reserves will amount to USD 65 billion.
Despite the NBU’s “reassurance” in the form of a rate cut and reminders from the regulator’s top officials about the upcoming multibillion-dollar financial support from partners, the FX market is still trying to follow the devaluation trend. There are many reasons for this: large-scale shelling of cities, which has significantly worsened the situation in the energy sector, the difficult situation at the front, and the lack of clear signals from the IMF regarding the approval of a new program worth $8.1 billion.
US dollar exchange rate: dynamics and analysis
General characteristics of market behavior
In the Ukrainian foreign exchange market in January, the dollar initially gained ground, but lost ground in the second half of the month as the hryvnia strengthened. At the beginning of the month, the interbank exchange rate was at UAH 42.3 per dollar, while on January 15 it was at UAH 43.55 per dollar, and on January 29 it was at UAH 42.9 per dollar.
The cash market experienced accelerated devaluation waves, and in mid-January the purchase rate reached 43-43.2 UAH/USD, while the sale rate was in the range of 43.6-43.7 UAH/USD, but at the end of the month, the strengthening of the hryvnia on the interbank market also affected the cash segment, where the purchase rate was 42.5-42.3 UAH/USD, and the sale rate was 43-43.15 UAH/USD.
Meanwhile, the spread between the buying and selling rates at bank cash desks and exchange offices increased to UAH 0.55-0.65 per dollar compared to December.
The cash market saw a surge in demand in January: according to the NBU, between January 1 and January 27, households purchased USD 1.64 billion (in equivalent), while sales of cash currency by households during this period amounted to USD 0.97 billion.
Key factors of influence
– International context. The dollar began to strengthen very actively against the euro as a result of the expected pause in the Fed’s interest rate cuts, as well as pessimistic expectations about the development of the US economy in 2026, including inflation and the labor market. Investor sentiment was also affected by President Donald Trump’s statements on the dollar’s strength and on Greenland.
– The National Bank of Ukraine cut its key policy rate to 15%, thus starting to ease monetary policy to bring inflation in Ukraine to the 5% target.
– The NBU increased interventions in the interbank market as part of its managed exchange rate flexibility strategy, which brought the dollar back below the psychological level of UAH 43/USD at the end of January.
Forecast.
– In the short term (1-2 weeks): the basic range of 42.9-43.4 UAH/$ with possible fluctuations towards a weaker hryvnia.
– Medium-term (2-3 months): UAH 43.50-44.00/$. In the international market, the weak dollar trend may change in the short term to return to last year’s exchange rate levels of approximately 1.17 EUR/USD. However, the inconsistent policies of President Donald Trump and the situation around the upcoming change of the Fed chairman and expectations of a new stage of easing in the US will send signals to investors about the long-term trajectory of the weak dollar. In Ukraine, the national currency will be influenced by the situation with the receipt of aid from partners, as well as the level of the energy crisis and the speed of its resolution. Demand on the interbank market will remain high.
– Longer term (6+ months): The scenario of gradual devaluation remains in place, and the NBU will periodically enter the market with more foreign currency supply to level out demand. The benchmark for the first half of 2026 is UAH 43.5-44.9/$.
Euro exchange rate: dynamics and analysis
General characteristics of market behavior
In January, the euro strengthened on the Ukrainian market: the official euro exchange rate stood at UAH 49.79/€ in early January and reached UAH 51.24/€ at the end of the month. In the cash segment, the euro also strengthened quite significantly in January: at the beginning of the month, the average buying rate was 49.5 UAH/€, and the selling rate was 50.17 UAH/€. By the end of the month, the euro was buying at 51 UAH/€ and selling at 51.95 UAH/€ in banks and exchange offices.
Key observations
– Exchange rate geometry: At the end of January, the selling rate for cash euros was at the level of 51.6-51.95 UAH/€. The dynamics of the euro exchange rate was influenced by the general devaluation trend, which intensified in the first two weeks of January 2026, as well as by the rapid and steady strengthening of the euro on the global market.
– Supply and demand: Demand for euros in early 2026 is at a high level as importers are actively purchasing energy equipment, the need for which has increased sharply after several massive Russian attacks targeting thermal power plants in large cities. On the cash market, demand for both dollars and euros grew during the month.
Key influencing factors
– Global context: the euro is strengthening against the dollar amid unstable forecasts for the US economy and political statements by Donald Trump, which affect investors’ desire to exit the dollar into safe-haven assets such as the euro, Swiss franc, and gold.
– Domestic market: On January 27, the euro crossed the psychological mark of 51 UAH/euro (official exchange rate), and in the cash segment is rapidly approaching the level of 52 UAH/euro, which stimulates demand for the European currency.
– Behavioral factor: In Ukraine, there has been an increase in both the volume of purchases of dollars and euros and the volume of currency sales, and the activity of currency exchange operations traditionally increases in difficult crisis periods. In January 2026, net purchases of foreign currency by households are likely to exceed December’s figures: the balance for January 1-27 is USD 693 million (December: USD 739 million).
Forecast.
– In the short term (1-2 weeks): the euro will be in the range of 51.5-51.9 UAH/€ with a tendency to move to the upper limit.
– Medium-term (2-3 months): the trend for a strong euro and, accordingly, a weak dollar may continue for some time in the international market. In Ukraine, in addition to the global trend of a stronger euro, the exchange rate will be affected by general devaluation sentiment due to high volumes of imports in euros, which will accelerate the euro’s growth. The exchange rate target is 51.8-53.5 UAH/€.
– Longer-term (6+ months): the euro may rise to 53.5-55.5 UAH/€ in the first half of 2026.
Recommendations: dollar or euro – buy, sell, or wait?
USD/UAH
The dollar’s weakening trend, caused by investors’ doubts about the prospects for the US economy and skeptical assessments of the labor market, is further reinforced by negative expectations about geopolitical risks (in particular, in the case of Greenland), a change in the Fed’s leadership, and concerns about the Fed’s independence.
Investors see the future policy of the Fed as another risk, as investors fear inconsistent steps and a lack of predictability as Donald Trump continues to put pressure on the Fed. This means that the dollar is unlikely to strengthen to 1.1650 in the near future, and large investors are looking for ways to redirect their investments from the dollar to other currencies and liquid assets.
Ukraine is currently experiencing a clear devaluation trend, which means that dollar-denominated savings will remain the main basis for investors’ medium- and long-term strategies. The next stages of hryvnia devaluation will only lead to some options for generating speculative income on currency exchange. However, the dollar remains the main savings currency for various investment plans.
EUR/UAH
In recent months, the euro has shown a strengthening trend, which allows investors planning to enter the dollar to do so profitably. Investors will also continue to buy euros to form part of their savings in this currency as part of a long-term strategy. As the liquidity of the euro is only improving, investors can expect to keep about 40% of their foreign currency savings in this currency.
Overall strategy
In January 2026, the Fed Committee meeting ended with the expected “nothing” – the rate was left at the current level. Pessimism about the future development of the US economy and uncertainty about clear and adequate steps by the Fed contribute to the dollar’s decline. But there are no “black swans” in the EU: the economy is growing, inflation risks are minimal, and in February the ECB may consider the situation in more detail and announce whether it is preparing to change rates.
In Ukraine, frosts, blackouts and devaluation sentiment prevail, and investors continue to formulate their savings plans with a view to the upcoming weakening of the hryvnia. The National Bank of Ukraine is closely monitoring the market and is ready to intervene in case of peak demand, while the managed exchange rate flexibility strategy will allow us to remain cautiously optimistic about the pace of further devaluation movements. Basic rules for investors: no sudden decisions, especially when there is panic on the interbank market. We analyze the general global trend together with the internal Ukrainian realities and only then decide whether to exit the currency or move from the dollar to other assets. It is important to regularly review your own savings programs in order to respond to trends in time and increase the level of return on investments in foreign currencies.
This material was prepared by analysts of the international multiservice FinTech product platform KYT Group 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 to update or supplement.
Users of this material should make their own risk assessment 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 marketplace FinTech product platform that provides financial companies with access to services for promoting their services, as well as advertising and consulting services.
Issue No. 1 – January 2026
The purpose of this review is to provide an analysis of the current situation on the Ukrainian currency market and forecast 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 currency market
International context
The beginning of 2026 brought bad news for Fed Chairman Jerome Powell as the US Department of Justice served him with a subpoena threatening criminal charges in connection with his testimony before the Senate Banking Committee in June 2025. This testimony partly concerned a multi-year project to renovate the Fed’s historic office buildings. Powell himself said that he considers such actions in the context of pressure on the Fed from Donald Trump. “The threat of criminal prosecution is a consequence of the Fed setting interest rates based on our best estimate of what will serve the public, not on the president’s preferences. The question is whether the Fed can continue to set interest rates based on data and economic conditions, or whether monetary policy will be guided by political pressure or intimidation,” Jerome Powell said in an official statement.
In December, the Fed cut interest rates by a quarter of a percentage point, the third consecutive rate cut in 2025. At the time, the main factor influencing the decision to cut rates was concern about the labor market. The Fed’s next interest rate vote will take place at a meeting on January 27-28. However, market participants do not expect any changes at the beginning of the year.
The Fed’s forecast calls for only one rate cut in 2026, but the market believes that there could be two rate cuts this year. The economic outlook, of course, complicates the Fed’s work. Inflation in the US is expected to remain high, and the labor market is expected to improve in 3-5 months.
Goldman Sachs Research notes that U.S. economic growth will accelerate to 2-2.5% in 2026 due to the reduced impact of tariffs, as well as tax cuts and easier financial conditions, unemployment will be just above 4.4%, and the Fed will cut rates in March and June. Thus, rates will be in the range of 3-3.25%. However, there are other forecasts, for example, JPMorgan expects the Fed to leave interest rates unchanged this year before raising them in the third quarter of 2027. In this case, rates will remain in the range of 3.5-3.75% in 2026.
As for the EUR/USD pair, while in December the dollar was weakening, in particular against the backdrop of the Fed’s rate cut, in mid-January the trajectory went in favor of a strong dollar, reaching 1.1635 EUR/USD, while at the end of December it was at 1.1772 EUR/USD. The dollar is currently maintaining its strong position thanks to strong US macroeconomic data and reduced concerns about the independence of the US Federal Reserve. The latest economic data from the US showed a greater-than-expected acceleration in producer prices and a good recovery in retail consumption in November. This allows the Fed to keep interest rates unchanged for now. Accordingly, this situation plays into the hands of the dollar, which has been steadily strengthening in mid-January.
Domestic Ukrainian context
The new year brought an acceleration of devaluation processes to the interbank foreign exchange market. While at the very beginning of January the official exchange rate was at 42.35 UAH/USD, on January 12, the exchange rate crossed the psychological mark of 43 UAH/USD and reached 43.07 UAH/USD. However, the dynamics did not stop there, and as of January 16, the official exchange rate was set at 43.39 UAH/USD.
The NBU has been actively supporting the market with interventions: in December, the NBU’s net sales of foreign currency on the interbank market reached a record $4.7 billion, and compared to November, the volume of the NBU’s foreign exchange interventions increased by $1.8 billion. The NBU itself explained this increase in foreign exchange interventions by the traditional seasonal factor of increased budget spending and business operations at the end of the year.
International reserves at the beginning of January 2026, according to preliminary data, amounted to $57,292.5 million. The NBU clarified that in December they increased by 4.6% compared to November due to receipts from international partners, which exceeded the NBU’s net sale of foreign currency and the country’s debt payments in foreign currency. In particular, the government’s foreign currency accounts at the NBU received USD 6.915 billion, of which the largest share was received from the EU under the Ukraine Facility (USD 2.69 billion) and USD 3.9 billion came through the World Bank’s accounts. In total, Ukraine’s international reserves increased by 30.8% in 2025, and the current amount provides financing for 5.9 months of future imports.
The NBU’s key policy rate remains unchanged at 15.5% per annum. However, it is likely to be cut in 2026. The NBU reported that in December 2025, inflation continued to slow down to 8% year-on-year. Month-on-month, prices rose by 0.2%. Thus, actual inflation in December 2025 was lower than the NBU’s forecast, which says that inflation is expected to slow further in 2026, in particular due to a gradual reduction in labor market imbalances, moderate external price pressures, and the NBU’s monetary policy measures. Thus, there remains a high probability that the NBU will decide to cut the key policy rate.
An important issue remains the receipt of international aid in 2026. Earlier, the government and the NBU pointed to the need for external financing at USD 45 billion, most of which is the Ukraine Facility program and funds under the ERA mechanism (a loan secured by the proceeds of frozen Russian assets). On January 14, the European Commission presented a package of legislative proposals that would allow Ukraine to receive the previously approved €90 billion loan in 2026 and 2027. According to the EU, approximately €60 billion will be used for military aid, and another €30 billion for general budget support. By the way, these 30 billion euros will be provided subject to the reforms to be implemented in Ukraine: the European Commission has already noted that in order to receive them, Ukraine needs to implement reforms to improve democratic processes, the rule of law and the fight against corruption.
US dollar exchange rate: dynamics and analysis
General characteristics of market behavior
During the first half of January, the dollar was strengthening on the Ukrainian foreign exchange market. Thus, while at the beginning of the month the interbank exchange rate was at UAH 42.3/USD, on January 15 it was already at UAH 43.55/USD.
Devaluation fluctuations were expected to be faster in the cash market, where the purchase rate in mid-January reached a corridor of UAH 43-43.2 per dollar, and the sale rate was in the range of UAH 43.6-43.7 per dollar. Meanwhile, the spread between the buying and selling rates at bank cash desks and exchange offices remained unchanged compared to December, at UAH 0.4-0.6 per dollar.
Key factors of influence
– International context. The dollar began to strengthen against the euro as investors grew more confident that the Fed would maintain its independence and implement its planned base rate cuts in 2026.
– International reserves are at a high level: as of early January 2026, they reached USD 57.29 billion.
– The NBU has started a phase of controlled devaluation: the interbank exchange rate is steadily moving towards a weaker hryvnia. This is likely to help the government receive more state budget revenues from international aid received by the country in foreign currency.
Forecast.
– Short-term (1-2 weeks): base range of UAH 43.4-43.9 per USD with possible fluctuations towards a weaker hryvnia.
– Medium-term (2-3 months): 43.40-44.80 UAH/USD. The dollar may gradually strengthen in the international market due to the stabilization of the situation in the US in terms of macroeconomic indicators and the Fed’s clear and understandable steps to change the base rate. In Ukraine, the hryvnia will be affected by factors such as a significant deterioration in the energy sector as a result of massive shelling, the state budget deficit, the high need to increase imports of energy equipment, and planned foreign aid inflows under previously approved programs and new projects.
– Longer-term (6+ months): The hryvnia will devalue against the dollar, the NBU will be forced to increase interventions from time to time, but the trend toward a weaker national currency will dominate. The benchmark for the first half of 2026 is UAH 43.4-44.9 per dollar.
Euro exchange rate: dynamics and analysis
General characteristics of market behavior
The euro strengthened on the Ukrainian market during the first half of January: the official euro exchange rate was UAH 49.42/€ at the end of December and reached UAH 50.43/€ in mid-January.
Key observations
– Exchange rate geometry: In mid-January, the selling rate for cash euros was at 50.9 UAH/€. The dynamics of the euro exchange rate was influenced by the general devaluation trend, which intensified in the first two weeks of January 2026.
– Supply and demand: Demand for euros remains strong, especially amid high demand from importers to purchase energy equipment from sellers in the European Union. In the cash market, demand for both dollars and euros remains stable.
Key influencing factors
– Global context: the euro is reacting with a slight decline against the dollar due to the stabilization of the macroeconomic situation in the US and no changes in the Fed’s monetary policy, which supports the dollar.
– Domestic market: the euro crossed the psychological mark of 50 hryvnia per euro, and demand for the euro remains high both on the interbank market and in the cash segment.
– Behavioral factor: households continue to hold their savings in foreign currency, with both the share of dollars and euros in savings increasing. In December 2025, net purchases of foreign currency by households reached USD 739 million.
Forecast.
– In the short term (1-2 weeks), the euro will be in the range of 50.5-51.5 UAH/€ with the possibility of moving closer to the upper limit.
– Medium-term (2-3 months): the postponement of the next stage of monetary policy easing in the US will keep the trend of a strong dollar in the international market, but Ukraine will see a strengthening of the euro as a result of the general devaluation trend and high demand for the currency from businesses and households. The exchange rate target is 51.5-53.8 UAH/€.
– Longer-term (6+ months): the euro may rise to the level of UAH 54.0-57.0 per EUR in the first half of 2026.
Recommendations: dollar or euro – buy, sell, or wait?
USD/UAH
The strengthening of the dollar, which the markets have been pricing in as a result of optimism about the Fed’s monetary policy and expectations for updated US economic data, may be followed by the next stage of the US currency’s weakening due to geopolitical risks, a deteriorating US labor market, and investor concerns about the Fed’s independence.
The upcoming change of the Fed chairman and the markets’ doubts that the new head of the US central bank will continue the policy of the current leadership are a particular risk. This means that the dollar is unlikely to strengthen to 1.1450 in the near future. Meanwhile, the dollar remains the main reserve currency, which means that buying the dollar is advisable both in the long and short-term investment strategy.
In Ukraine, a steady devaluation trend is expected in 2026, which means that dollar savings will be the basis for investors, especially for a long-term currency strategy. If exchange rate fluctuations accelerate toward a stronger dollar, investors will be able to exit some of their dollar savings with a profit.
EUR/UAH
The euro is showing a steady upward trend in the Ukrainian market. This allows investors to plan their exit from this currency, provided that the benchmarks set out in their individual investment strategy are achieved. In order to diversify part of your savings, you should also consider buying tranches of euro currency at times of exchange rate stability. It is advisable to keep about 30-40% of your savings in euros, depending on the currency plan you choose.
Overall strategy
In January 2026, expectations of the next round of Fed key policy rate cuts and US inflation data will contribute to a weaker US currency. Meanwhile, the EU economy has stabilized, with the ECB reporting that inflation was 2.0% in December, economic activity remained stable, and the unemployment rate in the EU is close to a historic low. Compared to previous forecasts, EU economic growth was revised upward to above 1% this year and to 1.4% in the following years. All of this points to a low probability of rate changes in the EU in the near future, which will also support the euro.
As expectations of further hryvnia depreciation prevail in Ukraine, this allows investors to plan both a medium- and long-term strategy for building foreign currency savings, taking into account the strong positions of the dollar and euro. The main rule is that if short-term speculative transactions are required, the euro is the right currency. For long-term and medium-term investments, it is worth considering the US dollar as the underlying asset, which provides both low-risk investments and the possibility of receiving a stable profit. It is important to analyze not only the trends of the domestic currency market, but also the behavior of the EUR/USD currency pair on the global markets. This will allow you to revise your strategy in a timely manner and increase the level of return on foreign exchange investments.
This material has been prepared by analysts of the international multiservice product FinTech platform KYT Group 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 further warranty of completeness, obligation to be timely or to be updated or supplemented.
Users of this material should make their own risk assessment 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 marketplace FinTech product platform that provides financial companies with access to services for promoting their services, as well as advertising and consulting services.
On January 1, 2026, Bulgaria officially switched to the euro and became the 21st country in the eurozone. For the Bulgarian economy, this step is largely institutional in nature: for many years, the lev was tightly pegged to the euro through the currency board, so the market did not expect a sharp change in the monetary regime. At the same time, the country will get a seat on the ECB’s governing bodies and deeper integration into the eurozone’s financial system, according to the Experts Club information and analytical center.
Maksym Urakin, founder of the Experts Club analytical center, believes that the effect of the transition will be determined by how quickly the authorities “knock down” inflation expectations among the population and businesses: “The euro itself does not make the economy richer overnight, but it reduces transaction costs and increases investor confidence. The key test in the first few months will be controlling price speculation and communicating clearly with consumers.”
The main domestic risk around which public debate in Bulgaria is centered is inflationary expectations and fears of price “rounding” in retail and services. Such fears traditionally accompany currency changes, even if the actual effect is usually limited in time and concentrated in the sector of daily household expenses.
After Bulgaria’s entry into the eurozone, six countries remain in the EU that do not use the euro: Sweden, Poland, the Czech Republic, Hungary, Denmark, and Romania.
According to Experts Club estimates, the expansion of the eurozone will be slow in the coming years, as each of these countries has its own “stop factors” — from political constraints to failure to meet convergence criteria and budget deficit problems.
In Poland, for example, the government has publicly stated that the country is “not yet ready” for the euro and considers the zloty to be an instrument of macroeconomic flexibility that has helped it weather past shocks.
In the Czech Republic, President Petr Pavel has called for more active movement towards the euro as a factor in trade and decision-making, but there is no political consensus on the timing in the Czech Republic.
In Hungary, Prime Minister Viktor Orbán, on the contrary, has stated several times that the country should not adopt the euro.
Sweden formally relies on the results of the 2003 referendum, when 55.9% of voters opposed the introduction of the euro.
Denmark, unlike the others, has a legally enshrined right not to introduce the euro (opt-out), confirmed by a referendum in 2000.
Experts Club notes that Romania is considered the next country after Bulgaria that is most likely to apply for the introduction of the euro. However, the actual timeline depends on inflation and the budget trajectory: the European Commission indicated in its convergence materials that Romania does not meet the conditions for adopting the euro, including the parameters of public finance sustainability and legal compatibility. The public guidelines in the Romanian discussion mention a target date of around 2029, but the timing may shift depending on economic indicators and fiscal adjustments.
Issue No. 2 – December 2025
The purpose of this review is to provide an analysis of the current situation on the Ukrainian currency market and forecast 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 currency market
International context
The second half of December 2025 was influenced by the third cut in the US Federal Reserve’s key policy rate this year, as well as expectations of a planned rate cut in the new year 2026. Most analysts believe that the latest key macroeconomic data support expectations that the Fed will continue to cut rates in 2026. Inflation in the United States fell more than expected to 2.7% year-on-year, while unemployment rose to 4.6%. These statistics allow the Fed to plan further rate cuts. The next meeting of the Fed Committee will take place in late January, and it will be known whether the rate cuts will take place at the beginning of the year or whether the Committee members will decide to postpone the next stage of monetary policy easing to March.
Meanwhile, the media was stirred up by the statement of the Donald Trump administration regarding its expectations for US GDP growth of 3% in 2026. Joe Lavorgna, an adviser to US Treasury Secretary Scott Bessent, noted that if the economy continues to grow by 3% next year due to increased supply, this will mean a decline in inflation. In his opinion, the Fed can continue to cut rates, and even said that the Fed should cut rates. Currently, the US is in a bit of euphoria over the fact that GDP for the third quarter was 4.3%, as consumer spending, which accounts for 70% of growth, and exports have both increased. Donald Trump also said that he expects the next Fed chairman to cut interest rates if the economy is doing well. It is currently known that the Fed has planned one rate cut in 2026, but in the end, everything will depend on the position of the new Fed chairman and the receipt of new statistics on inflation and the US labor market. It is possible that the rate will be cut twice, depending on the rate of real economic growth. Analysts also believe that any sharp decline in the artificial intelligence boom will require further rate cuts, as artificial intelligence has contributed to the lion’s share of GDP growth over the past year, both directly through business investment and indirectly through the rising stock market, which has stimulated consumer spending.
As expected, the key policy rate cut affected the behavior of the EUR/USD pair, and the dollar is weakening despite positive signals about the growth rate of the US economy. At the end of December, the rate was above $1.1772, so it continues to test new levels – closer and closer to the $1.1800 level previously predicted by analysts. In the future, the dollar is expected to weaken against the euro, in particular against the backdrop of central bank policy.
As for the stability of the euro, it is clear that the eurozone has managed to overcome the effects of Trump’s new tariffs faster and better than expected. Growth in Europe remains steady, with inflation hovering close to the ECB’s 2% target. At the end of 2025, the European Central Bank left its key deposit rate unchanged at 2%. According to the ECB, the eurozone’s GDP growth for the year will be 1.4%, compared to the previous estimate of 1.2%. For 2026, GDP growth is projected at 1.2%, and the eurozone economy will grow by 1.4% in 2027.
Domestic Ukrainian context
While in the first half of December, the hryvnia remained in the range of 42.26-42.33 UAH/USD (official exchange rate), in the second half of the last month of 2025, there were multidirectional fluctuations, when on December 18, there was a clear weakening of the hryvnia – the average value on the interbank market reached 42.40 UAH/USD, and the official exchange rate was 42.34 UAH/USD. However, in the following sessions of December, the market leveled off, in part due to the participation of the National Bank of Ukraine in the auction, and the hryvnia strengthened: the official exchange rate returned to below 42 UAH/USD. In October, the NBU sold $2.9 billion in foreign currency, and in November it sold $2.88 billion. It is likely that in December, interventions will also be no less than in November. In total, the NBU sold $34.6 billion on the market since the beginning of the year and through December 19.
December was a successful month for Ukraine, when it received multibillion-dollar tranches of funds from its partners. In the third decade of December, Ukraine received €2.3 billion under the Ukraine Facility program (the sixth tranche under the program), bringing the total amount of EU financial assistance in 2025 to more than €28.7 billion. The funds received help support the economy and ensure macrofinancial stability.
The NBU discount rate remained unchanged at the end of 2025, remaining at 15.5% per annum. The NBU said that it expects the risks associated with the adequacy and rhythm of external financing to ease, allowing the NBU to start a cycle of key policy rate cuts next year. The NBU’s Monetary Policy Committee believes that the key policy rate will be 12.5% at the end of 2026, but the balance of risks to inflation and the key policy rate trajectory has shifted upward in the wake of the war, so they do not rule out a tighter policy scenario.
Next year is not expected to be easy and predictable for the national currency, which is under considerable pressure in the context of the war due to the great uncertainty about the duration of hostilities and changes in the situation at the front, risks to the energy and industrial sectors in general, and high import needs for equipment, military equipment, and fuel. The trajectory of the exchange rate will depend on many factors, and one of the key ones will be the volume and rhythm of foreign aid inflows.
According to the EU, Ukraine needs $81 billion in additional financial assistance for defense and government operations in 2026. The good news in December was the approval of a €90 billion loan from the EU to Ukraine – the leaders of the EU member states reaffirmed their readiness to help Ukraine ensure financial sustainability in 2026-2027, in particular to cover urgent budgetary, military, and defense needs. The parties agreed to provide Ukraine with a €90 billion loan at the expense of EU borrowings in the capital markets, and Ukraine will repay the loan only after Russia compensates for the damage caused by the aggression.
US dollar exchange rate: dynamics and analysis
General characteristics of market behavior
In the second half of December, the US dollar initially strengthened on the Ukrainian market, but then the trend reversed. As a result, the hryvnia suddenly started to strengthen at the end of the year.
In general, the exchange rate changed in December as follows: on the interbank market, the selling rate at the beginning of the month was at 42.32 UAH/$, on December 18 – at 42.40 UAH/$, but on December 25, there was a pullback to 42.06 UAH/$.
On the cash market, the buying rate in December was in the range of UAH 41.6-42.10/$, and the selling rate was in the range of UAH 42.2-42.55/$. At bank cash desks, the spread between the buying and selling rates remained unchanged compared to November, amounting to UAH 0.45-0.6 per dollar.
Key factors of influence
1. International context. The dollar began to lose ground sharply against the euro as a result of the third Fed key rate cut in 2025, as well as expectations of the next round of easing in January 2026.
2. Ukraine continues to receive assistance from its partners: in the third decade of December, the country received €2.3 billion under the Ukraine Facility program, and the EU agreed on a €90 billion loan to Ukraine.
Forecast.
– Short-term (1-2 weeks): the basic range is 42.15-42.55 UAH/$ with possible multidirectional fluctuations.
– Medium-term (2-3 months): 42.30-43.50 UAH/$. On the international market, the dollar’s weakening will be influenced by the Fed’s monetary policy, i.e. further steps to reduce the key policy rate. In Ukraine, the hryvnia will be affected by factors such as the state budget deficit, the situation at the frontline, gas purchases, imports of energy equipment, and new aid inflows from partners.
– Longer term (6+ months): the depreciation trend will remain dominant, with the NBU’s ongoing interventions keeping exchange rate fluctuations smooth and the exchange rate trajectory flexible. The exchange rate target for the first half of 2026 is UAH 42.6-44.60/$.
Euro exchange rate: dynamics and analysis
General characteristics of market behavior
In December, the euro strengthened on the Ukrainian market: the official euro exchange rate was 48.89 UAH/€ in early December and 49.42 UAH/€ at the end of the month.
Key observations
Ø Exchange rate geometry:
o The selling rate for cash euros at the beginning of the month was at around UAH 49.45-49.50/€, and at the end of December it was at UAH 49.8-49.9/€. The dynamics of the euro exchange rate was influenced by the global market trend, where the euro strengthened, and was also reflected in the exchange rate by the growing demand for euros from importers on the interbank market.
Ø Supply and demand:
o Demand for euros has been at a high level for several months in a row, as domestic companies make payments to European sellers in euros. Demand on the cash market also remains strong, as well as expectations that the euro will soon cross the psychological mark of 50 UAH/€.
Key influencing factors
– Global context: The euro is strengthening as a result of the US’s gradual easing policy, which is reflected in the exchange rate trajectory in the direction of a weaker dollar and a stronger euro. The euro’s stability is also linked to the eurozone’s continued and steady economic growth and the overcoming of the challenges posed by Trump’s tariffs.
– Domestic market: demand for the euro in the cash segment remains stable, although the traditional trend of a temporary increase in the volume of cash sales by households, including the euro, is noticeable in the run-up to the Christmas and New Year holidays.
Forecast.
– In the short term (1-2 weeks), the euro will be in the range of 49.6-49.9 UAH/€ with the possibility of a temporary move to the level of 50 UAH/€.
– Medium-term (2-3 months): if the Fed cuts the rate by 25 bps in January, the euro will continue to strengthen, and fluctuations on the Ukrainian market may be in the range of UAH 49.9-52.80/€.
– Longer-term (6+ months): the euro is likely to rise in the first half of 2026 to the level of 52.20-56.80 UAH/€.
Recommendations: dollar or euro – buy, sell, or wait?
USD/UAH
For 2026, most forecasts are related to the continued growth of key economies and investment, in particular in new technologies and AI tools. However, there are restrained hopes for cautious economic growth, so we cannot expect explosive growth in the economies of the United States, the European Union, China, and Japan. Meanwhile, the US dollar will be influenced by the US Federal Reserve’s monetary policy, uncertainty about the new Fed chairman and his attitude to the implementation of the inflation control strategy.
The scenario of further weakening of the US currency amid rate cuts and the situation in the US labor market remains highly likely. There may also be unexpected “black swans” in 2026, as geopolitical tensions persist, in particular due to the ongoing war in Ukraine, and there are risks associated with the high debt burden of developed countries. Experts also see another risk as threatening: the rapid development of artificial intelligence could create an economic bubble and increase fears about the future labor market.
In this situation, investors should consider both liquid currencies (dollar, euro) and gold, which is a traditional safe haven for capital in times of uncertainty and high risks, when planning future investments.
EUR/UAH
The euro currency is strengthening in the global and domestic markets, but is subject to multidirectional trajectories, which may complicate the investment program for this currency. It is likely that the euro will have a chance to strengthen globally in the coming months. For Ukrainian investors, the euro will remain one of the most important areas of the currency accumulation strategy, although the US dollar will have a predominant place in the portfolio for long-term planning.
Overall strategy
Next year will certainly be challenging for investors, as the possibility of uneven exchange rate fluctuations remains, both due to the Fed’s monetary policy and the ongoing economic challenges for key global economies. As the US continues its easing policy, the dollar may continue to weaken, while the euro is likely to strengthen thanks to the ECB’s steady policy and positive forecasts for the eurozone’s economic development.
In the medium- and long-term investment strategy, the dollar will retain its dominant position, as the US currency remains the main reserve currency and plays a leading role for central banks and global investments. Thus, in Ukraine, the US dollar will have a major share in investors’ foreign currency savings. Meanwhile, the country’s proximity to the EU, close business ties with eurozone countries, and the steady strengthening of the euro allow it to be included in various foreign exchange savings programs.
In 2026, most forecasts are associated with a gradual weakening of the hryvnia exchange rate, which is reflected in both the State Budget Law and the requirements of the International Monetary Fund. Demand for cash and non-cash foreign currency will remain high. Fluctuations in Ukraine’s interbank market will be smoothed out by the NBU’s interventions, which will maintain its policy of exchange rate flexibility in the face of war and heightened economic challenges. The expected weakening of the hryvnia will allow investors to build a reliable portfolio of savings in liquid currencies and partially focus on gold assets. The US dollar and the euro will remain the main currencies for investment strategies.
This material was prepared by analysts of the international multiservice FinTech product platform KYT Group 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 to update or supplement.
Users of this material should make their own risk assessment 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 marketplace FinTech product platform that provides financial companies with access to services for promoting their services, as well as advertising and consulting services.
The November collapse of bitcoin from levels above $120 thousand to the zone of about $80 thousand was a cold shower for retail investors – primarily young investors, for whom crypto has long become not an exotic, but the main “investment” instrument. But the current correction has not destroyed the interest, but only exposed what professionals have been saying for a long time: in the eyes of some young people, the crypto market looks more and more like high-risk betting rather than classic investments.
A fresh survey by YouGov and Young Men Research Project, published by MarketWatch, shows a generational gap in financial behavior. Among U.S. men ages 18-29:
28% own crypto assets (cryptocurrency and/or cryptocurrency ETFs),
while only 21% are saving for retirement through 401(k) and other classic retirement plans.
Bitcoin remains the “anchor” of the portfolio, followed by Ether and Solana; the share of meme-coin investments is noticeably smaller, but these are the ones that reinforce the impression of a “casino approach” to money management. What’s also important is who exactly we see in these statistics. The research shows:
the higher the income and education level, the more likely a young person is to have both a crypto and a classic retirement account;
among freelancers and those in non-standard forms of employment, crypto is often the only “long term” asset – they simply don’t have access to retirement plans.
So this is not just a story about “irresponsible players” – in many ways it is a reaction to the new conditions of the labor market, where stability and a social package have become a luxury.
For some young people, crypto fulfills several roles at once:
Financial elevator. Against the backdrop of low housing affordability, expensive education and de facto stagnant wages, the temptation to “jump the ladder” through a successful entry into BTC or altcoin is very high. Stories of early holders with X10-X50 fuel expectations.
Part of the online culture. Crypto is embedded in the ecosystem of YouTube, Reddit, X, Discord. There’s also betting, trading, sports betting. For many, it’s a unified medium of pastime and risk. Researchers directly record the intersection of the audiences of cryptoinvestors and online gambling fans.
Distrust of the “old” system. Pensions and traditional funds are associated with bureaucracy, slow returns and lack of control. Crypto, on the contrary, seems to be an instrument of “personal freedom” – even if the real control is limited to knowing a couple of apps and passwords.
All of this makes the crypto market susceptible to waves of FOMO and panic. The November dip after historic highs showed how painful such swings can be for those who went in “on the shoulder of hope” rather than as part of a well-thought-out strategy.
1. The risk of a “lost decade” for personal finances.
If a significant portion of a generation is betting almost exclusively on crypto rather than a diversified portfolio and retirement savings, every major market drawdown sets their financial goals back years. It’s not just about balance sheet decline – it’s about psychological “burnout” from investing itself.
2. Increased market volatility.
The greater the share of participants with a short horizon, high risk tolerance and “game” orientation, the more the market resembles a derivative casino. This amplifies the amplitude of movements and increases the likelihood of sharp drops when macro backdrop or regulatory news deteriorates.
3. Field for regulators.
Crypto’s growing share of youth savings is almost guaranteed to increase regulatory attention, from the US to the EU to emerging markets. Already, restrictions on the marketing of high-risk products, requirements for exchanges to protect unqualified investors, and tighter KYC/AML controls are being discussed.
For countries like Ukraine, where the share of cryptoactive youth is also high, these trends mean an inevitable dialog: how to develop an innovative market without turning it into a mass trap for personal finance.
Outlook: three scenarios beyond November
If we look at the end of the year and 2026 through the lens of retail investors, we can roughly distinguish three scenarios:
“Nervous Stabilization” (baseline).
Bitcoin and large altcoins trade in a wide corridor, some retailers record losses and go into stablecoins or cache, but a core of young holders remain in the market. Crypto is gradually being integrated into more conservative products (ETP, funds), and the growth of interest compensates for the partial outflow of the disappointed.
New wave of euphoria.
Against the backdrop of falling rates, inflows of institutional capital or “Bitcoin in retirement plans” style news, we see a rally again. Young people see the November drawdown as “one more chance to get in” and the market structure becomes even more fragile due to increased shoulder demand.
Regulatory shock.
A major scandal, the collapse of another exchange or a tough package of restrictions in one of the jurisdictions may provoke not only a price spill, but also a mass exit of a part of retail. Against this background, interest in classic instruments (ETFs on indices, bonds, pension plans) temporarily increases.
Which scenario will be realized depends largely on macroeconomics, central bank policy and the depth of future regulatory reforms.
The November collapse showed the main fork for a young investor: to stay in the logic of rates or to switch to the logic of strategy. The answer to this question will determine not only the future bitcoin exchange rate, but also the financial health of an entire generation.
Issue No. 1 – December 2025
The purpose of this review is to provide an analysis of the current situation on the Ukrainian currency 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 foreign exchange market
The first half of December 2025 was spent waiting for the US Federal Reserve Committee to meet and decide on a new key policy rate. On December 10, at the meeting, as expected by markets and investors, the Committee decided on the next stage of easing, which shifted the Fed’s interest rates to a new range: from 3.5% to 3.75%. After announcing the decision on the new rate range, Fed Chairman Jerome Powell said that the Committee decided to cut rates due to a number of factors, including a cooling in the US labor market, i.e. an actual increase in the unemployment rate. According to him, the Fed believes that recent employment figures (about 60 thousand jobs) were “overstated”. “There is no risk-free path for policy as we navigate this tension between our employment and inflation goals. It is our responsibility to make sure that a one-time increase in the price level does not become a permanent inflation problem,” said Jerome Powell.
Whether there will be another rate cut at the end of January 2026 is one of the main questions that the Fed did not answer. The Fed says that the decision on the next vote at the end of January has not yet been made. Jerome Powell believes that after a three-quarter point cut, interest rates are in the neutral range, the level the Fed seeks, as it does not accelerate or slow economic growth. Meanwhile, the Fed chairman rejected speculation that a rate hike might occur next year.
For the EUR/USD pair, another cut in the key policy rate means that the US dollar continues to weaken. In fact, a few days after the Fed’s decision on the new rate range, the rate reached $1.1740, although on the day of the Fed Committee’s vote (December 10) it was at $1.1628. Thus, the dollar is testing new levels. Some Western analysts even believe that a move to $1.1800 and even further is likely.
While the United States is going through stages of monetary policy easing, the European Central Bank continues to maintain a conservative stance. ECB President Christine Lagarde noted that the eurozone economy has demonstrated resilience in the face of geopolitical and economic shocks. However, she emphasized that deeper structural reforms are needed to unlock its full potential, adding that monetary policy alone cannot achieve this goal.
As the Fed’s stance softens and the ECB’s rates remain stable, the rate differential is narrowing in favor of the euro. Therefore, traders now see less downside risk for the euro and expect the EUR/USD pair to remain above $1.1650. The contrast between the Fed’s rates and the ECB’s signals that it will not cut rates stimulates capital outflows to European assets and supports the euro well on the horizon for the next month.
Domestic Ukrainian context
In the first half of December, the hryvnia remained in the range of UAH 42.26-42.33 per dollar (official exchange rate), with a short-term tendency to strengthen – on December 8, the average exchange rate on the interbank market reached the level of UAH 42.03 per dollar, although later in December the exchange rate still returned to above UAH 42.2 per dollar.
In December, the hryvnia was supported by several important factors. One of the most important is the increase in international reserves: according to preliminary NBU data, as of December 1, reserves amounted to $54.748 billion. Thus, in November, reserves grew by 10.6%. As explained by the NBU, this dynamics is due to the largest amount of receipts from international partners since the beginning of the year, which exceeded the NBU’s net sale of foreign currency and the country’s debt payments in foreign currency. Currently, the volume of international reserves is sufficient to maintain the stability of the foreign exchange market and provides funding for 5.6 months of future imports.
In November, the NBU received $8.147 billion in foreign currency from partners, of which the largest amount ($6.880 billion) came from the EU under the G7 ERA initiative and the Ukraine Facility. In November, the NBU’s sales of foreign currency on the market decreased compared to October: the NBU sold USD 2.728 billion on the foreign exchange market and bought back USD 1.3 million to the reserves, so the NBU’s net sales of foreign currency in November amounted to USD 2.727 billion.
The NBU discount rate remained unchanged: On December 11, the NBU informed that it had left the rate at 15.5% per annum. The NBU explained that the decision was necessary to maintain the attractiveness of hryvnia instruments, the stability of the foreign exchange market, and control of expectations in order to bring inflation to the 5% target on the policy horizon.
So far, the situation is such that the hryvnia should not experience any sharp movements, but in the future (as early as 2026), the hryvnia will be under pressure from a number of factors, including possible difficulties with foreign aid (and a reduction in the amount of such aid). In addition, other risk factors that could affect the devaluation trend include an increase in budget spending on the defense sector, a labor shortage in the labor market, complications in the functioning of the energy sector amid constant missile and drone attacks, and new waves of migration abroad.
In total, the NBU’s baseline scenario for 2026 assumes that Ukraine will receive more than $45 billion in international financial assistance. But, as NBU Governor Andriy Pyshnyi explained, further support from international partners, including cooperation with the International Monetary Fund, has a huge impact on the prospects. Importantly, in late November, the IMF mission and the Ukrainian authorities reached a staff-level agreement on a new four-year program under the Extended Fund Facility (EFF) with potential access to $8.1 billion in funding. The new agreement provides for a set of fiscal and monetary policy measures to form the basis of the program, with the main objectives of the program being to maintain macroeconomic stability, restore debt and external sustainability, fight corruption, and improve governance.
US dollar exchange rate: dynamics and analysis
General characteristics of market behavior
In the first half of December, the US dollar moved in a variety of directions on the Ukrainian market, but the prevailing trend was toward strengthening the dollar and, consequently, weakening the hryvnia.
During the first two weeks of December, the exchange rate fluctuated as follows: at the beginning of the month, the interbank sale rate was at 42.37 UAH/$, then on December 8, the hryvnia strengthened to 42.02 UAH/$, and later in December, the hryvnia lost ground: the exchange rate reached 42.43 UAH/$, and then fell back to 42.2 UAH/$.
In the first half of December, the average purchase rate was in the range of 41.9-42.10 UAH/$ on the cash market, and the sale rate was in the range of 42.35-42.55 UAH/$. At bank cash desks, the spread between the buy and sell rates remained unchanged compared to November and amounted to UAH 0.45-0.6 per dollar as of mid-December.
Key factors of influence
Forecast.
Euro exchange rate: dynamics and analysis
General characteristics of market behavior
In the first half of December, the euro steadily strengthened on the Ukrainian market: within two weeks, the official euro exchange rate moved from 48.89 UAH/€ to 49.51 UAH/€.
Key observations
Ø Exchange rate geometry:
o The selling rate for cash euros was initially around 49.45-49.50 UAH/€. However, by mid-December, the euro had strengthened, and the average selling rate for euros on the cash market reached 49.8 UAH/€. This reflects the trend on the interbank market, where at the beginning of the month the selling rate was at 49.28 UAH/€, and in the middle of the month it was 49.50 UAH/€.
Ø Supply and demand:
o Demand for euros remained at a fairly high level, especially from businesses making payments to European sellers in euros. The cash market is also actively buying euros, expecting the euro to continue to strengthen in 2026.
o The spread between the euro’s bid and ask rates on the cash market remained unchanged in December and remained high, ranging from UAH 0.5 to 1 per euro.
Key factors of influence
Forecast.
Recommendations: dollar or euro – buy, sell or wait?
USD/UAH
The US dollar is under pressure from the US Federal Reserve’s monetary policy, as well as uncertainty about the next stages of key policy rate cuts in 2026. The US economy is currently facing significant economic shocks, including tariffs, labor shortages due to Donald Trump’s immigration restrictions, and large-scale government spending cuts. For the Fed, the level of predictability is complicated by the lack of comprehensive price and labor market data, which was suspended during the government shutdown.
In December and early January, markets expect the dollar to weaken further, with a realistic range of $1.1690-1.1810.
For Ukrainian investors, the dollar will remain the key currency of accumulation, and purchases should be considered as part of a medium- and long-term strategy.
EUR/UAH
The euro has been strengthening on the Ukrainian market in December, but the likelihood of sharp fluctuations and short-term pullbacks remains. However, the euro will maintain an uptrend in the near future due to the global market trend of strengthening against the dollar. The strategy of attracting euro currency to investors’ portfolios should be balanced, and although strategically the euro has high growth potential, high exchange rate volatility may affect future returns in case of a decision to exit euro investments urgently.
Overall strategy
The gradual reduction of the US Federal Reserve’s key policy rate is leading to a weaker dollar, and the Fed Committee’s further decisions on the rate level will be influenced by price and labor market data in the US. The euro is steadily strengthening against the backdrop of the Fed’s decisions and the absence of drastic changes in the policy of the European Central Bank, which is still maintaining the current level of rates.
Given global trends, investors should choose the dollar as a key savings currency in their medium- and long-term strategy, as even a weakening of the currency does not affect the liquidity of dollar savings. Savings in euros should be used for short positions and as a portfolio diversification when forming a long-term currency program.
The key forecasts for the foreign exchange market in Ukraine are related to the devaluation of the hryvnia in 2026. This means stable demand for the dollar and frequent spikes in peak demand for the euro. Given the high risks associated with the continuation of hostilities, the difficult energy situation, a decline in economic activity, problems in the labor market, and difficult predictability of funds from partners next year, demand for the dollar will grow in the short term. The National Bank of Ukraine will stick to its exchange rate flexibility strategy, which will mean no sharp devaluation swings and timely smoothing of fluctuations. The upcoming weakening of the hryvnia will allow investors to build a reliable portfolio of foreign currency savings in liquid foreign currencies, with the dollar and euro remaining the main currencies.
This material has been prepared by analysts of the international multiservice FinTech product platform KYT Group 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 further warranty of completeness, obligation to be timely or to be updated or supplemented.
Users of this material should make their own risk assessment 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 multiservice marketplace FinTech product platform that provides financial companies with access to services for promoting their services, as well as advertising and consulting services.
License of the National Bank of Ukraine for conducting currency transactions (trade in currency values in cash) No. 39806926 dated 06.06.2024.
