Financial news

US dollar value increased against main European currencies

International foreign exchange market. This day showed that the US dollar is still able to raise after many days of recession. By 18:00 KT, the US dollar rose against main European currencies almost by 100 points.

In the morning, the Bank of England decided to decrease discount rate by 25 basic points — to 5,00%. Rate decrease is caused by the Central Bank's wish to moderate inflation in Great Britain.

The head of the Federal Reserve Bank in Minneapolis declared today that recession in US economy is not likely to last more than 2-3 quarters, afterwards new growth is expected.

Euro exchange rate was negatively impacted by the publication of information on decrease of industrial activity in Eurozone in April to three years low — 50,8 points. These data generated fear that Eurozone economy begins to feel consequences of global economy slowdown.

Technical levels on the main currencies pairs as of 17:57 KT:

At the Ukrainian inter-bank foreign exchange market, the US dollar fall is suspended, and now the US currency is within the limits of 4,87/4,90 per $1 in expectation of new signals for the continuation of further move. On Tuesday, the US dollar fluctuated within a wider range — 4,85/4,92. Among main causes of the US dollar decrease in previous days market participants indicated hryvnia liquidity deficiency. Towards the closing of the trade, though, situation at inter-bank credits market improved. This leads to the conclusion that on Thursday bids the US dollar has sufficient chance to reclaim insignificant part of incurred losses and to exceed the level of UAH 4,90/$1.

The majority of deals were concluded today by market participants within the range of 4,88/4,89, with 4,895/4,910 at trading on Tuesday.

At DEPO-market, the hryvnia liquidity inflow at banking correspondent accounts amounting to no less than UAH 1 billion caused significant interest rates fall towards trade closure. But at the beginning of the day, panic still dominated the market and helped the rates to hold positions above 30% level for a long time.

Rates "overnight" in national currency are quoted today by the banks within the limits of 20,0/38,0%, with 27,0/40,0%. And by session closing rates level was 20,0/25,0%, with 28,0/38,0% in the morning. Weighted average price on concluded transactions by 17:00 KT constitutes today 31,4%, with 34,1% according to daily results on Tuesday. The volume of concluded transactions by this time constituted UAH 2,13 billion, with 2,95 billion on the previous day.

Rates on credits for a period "from 2 to 7 days" increased today to new levels and on certain transactions did not extend a little to the level of 50,0% p.a. Modifications were registered during the day within the range of 30,0/46,0%, and towards the end of the day weighted average price on concluded transactions amounted to 35,6%, with 36,8% a day earlier.

Rates on credits for a period "from 22 to 31 days" on actually concluded transactions are today within the range of 23,6/35,0%, with 29,0/48,0% on the previous day.

Comments by S.N. KRAMAROVA, the Head of the Treasury, PRAVEX-BANK

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