The National Bank of Ukraine has changed the approach to setting  the official exchange rate of the hryvnia against foreign currencies.

First, the NBU streamlines the methodology for calculating  the official hryvnia exchange rate against US dollar, based on which  the official exchange rate of the hryvnia against other currencies is calculated. Up until now, the official exchange rate has been calculated  as a weighted average of exchange rates quoted by buyers and sellers based on data from the System for Confirmation of Deals in Ukraine’s Interbank Foreign Exchange Market, meaning that it reflected the exchange rate under agreements between clients, banks and the NBU, the NBU and its clients. Going forward, only agreements between banks, as well as banks and the NBU will be included in the calculation. 

“This move is in line with practices followed in developed economies, where the reference exchange rates that are similar to our official exchange rates are calculated on the basis of exchange rates quoted in the interbank basis as they more adequately reflect the value of the currency,” explained Director of the NBU Open Market Operations Department Mr Serhii Ponomarenko. At the same time, changes in the calculation methodology will not have a significant impact on the official exchange rate of the hryvnia.

Second, the NBU updates the lists of foreign currencies against which the NBU sets the official exchange rate of the hryvnia on a daily and monthly basis.   

Currently, the NBU sets on a daily basis the official exchange rate against:

• 25 foreign currencies of the first group of the Classifier of Foreign Currencies and are listed as  MTP (main trading partner) currencies, 
• four banking metals.

The NBU sets on a monthly basis the official exchange of the hryvnia against another 30 foreign currencies.

The regulator considers it necessary to revise this list in view of the changes in the structure of Ukraine's foreign trade that have occurred in recent years and the updating of the Classifier of Foreign Currencies and Banking Metals in April 2016.

Going forward, the NBU will set on a daily basis the official exchange rate against:

• foreign currencies of Ukraine’s 30 largest trading partners  based on H1 2016 data (including 20 foreign currencies of the first group of FX Classifier), 
• another four foreign currencies of the first group of FX Classifier that are not MTP currencies,
• four banking metals.

In addition, the NBU once a month sets on a daily basis the official exchange rate against 22 more foreign currencies, including against seven currencies of CIS countries and 15 MTP currencies that are not included in the list of Ukraine’s 30 largest trading partners based on H1 2016 data.

The aforementioned  amendments to this effect  have been approved by  NBU Board  Resolution No. 391 of 13 October 2016  On Amendments to Some NBU Regulations. This resolution shall come into effect on 1 November 2016.