Mariupol Exchange Rates Vs. Laughable “Official” Rate: Foreign Exchange Intervention; IMF Calling The Shots?

Colonel Cassad reports It Takes 44 Hryvnia to Buy a Dollar in Mariupol.

Let’s do some quick math.

On Monday (perhaps reflective of Sunday) Ellen, who lives in Kiev wrote “Today $1 is worth 36 hryvnias on the black market. A Week ago it was 20 hryvnais. No one knows where the bottom is. People buy anything just to get rid of hryvnias.“

To be safe, let’s call it 10 days ago. In those 10 days, the hryvnia plunged from 20 to the dollar to 44 to the dollar. 

That is a decline of 54.54% in about 10 days. Here is the key “People buy anything just to get rid of hryvnias“.

Laughable “Official” Rate 

Here is an amusing chart from Investing.Com for February 25.

I explain that chart below. Meanwhile, rest assured that not a damn thing transacts at that rate other than perhaps graft and illegal transactions by bankers and Ukrainian officials selling 25 hryvnias for a dollar.

Poroshenko Ultimatum 

Earlier today I wrote …

Poroshenko Gives “Ultimatum” to Central Bank to Fix Exchange Rate 

 At a live press conference on the currency market, Poroshenko ordered the Chairman of the National Bank and the Finance Minister to Stabilize the Hryvnia at the “Budget” Rate of 21.5 hryvnia per dollar.

During an online broadcast, Poroshenko issued an ultimatum demanding the head of the National Bank of Ukraine, Valerie Gontareva, stabilize the hryvnia at a level which was guided by Cabinet in approving changes to the 2015 budget.

Amazing Reversal

Yesterday, February 24, the central bank put on currency restriction. Today we see National Bank has Overturned Yesterday’s Foreign Currency Ban. 

 National Bank of Ukraine (NBU) eased restrictions on foreign exchange market and abolished the prohibition of authorized banks to buy foreign currency on behalf of customers of the 26th and 27th of February.

The National Bank had introduced a temporary ban prohibiting banks to buy foreign currency on behalf of clients on February 25.

Consequential amendments to NBU resolution number 130 made ​​on February 24, and NBU Resolution 131 on February 25, published on the website of National Bank, were abolished.

On February 25, the NBU bought on the interbank foreign exchange market $80 million currency at the official rate, with further intent of foreign exchange intervention. 

The head of the NBU Valery Gontareva explained that the NBU bought currency on Wednesday on the interbank market and that “generated an additional supply of foreign currency”.

After the move by the NBU, the hryvnia exchange rate on the interbank market rose to 22-27 per US dollar and 24.96-30.6 per euro.