Currency Interventions as an Instrument of Currency Policy: International Experience and Features of Implementation in Ukraine

: pp. 97 - 106
Lviv Polytechnic National University
Lviv Polytechnic National University
Ivan Franko National University of Lviv
Ivan Franko National University of Lviv

The article is aimed to study the foreign experience of currency interventions as an instrument of currency policy and identify features of their implementation in Ukraine. Currency interventions, as an instrument of monetary policy, have become most widespread in the context of the Jamaican Monetary System and the transition to a floating exchange rate regime. The role of currency interventions has grown significantly since the global economic crisis of 2007-2009.

Until 2014, the interventions of the National Bank of Ukraine were carried out constantly in order to balance supply and demand for foreign currency and to maintain stable exchange rate dynamics of the national currency. With flexible exchange rate formation, the objectives of interventions change somewhat, although monetary authorities may also conduct them in order to avoid unnatural exchange rate deviations, normalize the market situation and accumulate foreign exchange reserves. In 2015, a flexible exchange rate regime was introduced in Ukraine, the aim of which was to ensure the balance of payments and avoid rapid fluctuations of the hryvnia, which were recorded in 2008 and 2014-2015. Since 2016, currency interventions have been carried out mainly in the form of foreign exchange auctions and were aimed mainly at increasing the country's foreign exchange reserves and increasing foreign currency sales.

Since 2018, the National Bank has switched to currency interventions at the best and single rate using  Matching  -  a  new  functionality  for  transactions  in  trade  information  systems  (Bloomberg, Thomson Reuters). The advantages of the Matching functionality (anonymity, unlimited number of participants, efficiency) create conditions for a more market, transparent and accurate determination of the hryvnia exchange rate in the interbank foreign exchange market.

Since the beginning of 2020, the National Bank of Ukraine has been conducting currency interventions with the help of interventions at the best exchange rate, currency auctions and interventions at a single exchange rate. From the beginning of 2020, the net sale of currency by the National Bank of Ukraine amounted to 524.70 million US dollars.

Currency interventions of the National Bank of Ukraine as an instrument of currency regulation are a supplement to the inflation targeting regime, as their tasks in the medium term support the NBU's goal of achieving price stability.

  1. Hrui A., Lepushynskyi V. (2016) Zastosuvannia valiutnykh interventsii yak dodatkovoho instrumentu za rezhymu infliatsiinoho tarhetuvannia: pryklad Ukrainy. [Application of foreign exchange interventions as an additional tool under the inflation targeting regime: the example of Ukraine]. Visnyk Natsionalnoho banku Ukrainy [Bulletin of the National Bank of Ukraine], No 238, pp. 41-59. Retrieved from: UJRN/Vnbu_2016_238_5. (in Ukrainian)
  2. Shpeniuk O. (2015) Dosvid vykorystannia valiutno-kursovoi polityky yak instrumentu vplyvu na natsionalnu konkurentospromozhnist u krainakh, shcho rozvyvaiutsia. [Experience of using the exchange rate policy as an instrument of influence on the national competitiveness in developing countries]. Visnyk Natsionalnoho banku Ukrainy [Bulletin of the National Bank of Ukraine], No4, pp. 48-55. Retrieved from: (in Ukrainian)
  3. Yurchishin V. (Ed.) (2019). Posylennia znachymosti monetarnoi polityky v krainakh Tsentralnoi i Skhidnoi Yevropy u postkryzovyi period i rekomendatsii dlia Ukrainy [The growing importance of monetary policy in Central and Eastern Europe in the post-crisis period and recommendations for Ukraine] – Kyiv : Zapovit, 147 (in Ukrainian)
  4. Bereslavska O.I. (2017) Valiutno-kursova polityka v umovakh infliatsiinoho tarhetuvannia v Ukraini. [Currency policy in conditions of inflation targeting in Ukraine]. - Zbirnyk naukovykh prats Universytetu derzhavnoi fiskalnoi sluzhby Ukrainy [Proceedings of the University of the State Fiscal Service of Ukraine], No2, pp. 24-36. Retrieved from: (in Ukrainian)
  5. Rishennya Pravlinnya Natsionalʹ noho banku Ukrayiny № 21-rsh vid 06 veresnya 2016 r. «Pro zatverdzhennya  Stratehiyi  valyutnykh  interventsiy  Natsionalʹ  noho  banku  Ukrayiny  na  2016-2020  roky»  [The decision of the National Bank of Ukraine number 21 PU on September 6, 2016 "On approval of the Strategy of currency  interventions of the National Bank of Ukraine for 2016-2020 years"]. Retrieved from: (in Ukrainian)
  6. Stratehiya valyutnykh interventsiy Natsionalʹ  noho banku Ukrayiny na 2016-2020 roky The strategy of currency interventions of the National Bank of Ukraine for 2016-2020 years]. Retrieved from:    (in   Ukrainian)
  7. Lavrov R. V., Sadchykova I. V., Seredyuk I. O. (2019) Suchasni tendentsiyi valyutnoho rehulyuvannya v Ukrayini. [Lavrov RV, Sadchikova IV, Seredyuk IO Modern tendencies of currency regulation in Ukraine]. - Ekonomika ta derzhava [The economy and the state], No8, pp. 4-11. DOI: 10.32702/2306-6806.2019.8.4. (in Ukrainian)
  8. Valyutni interventsiyi NBU [Currency interventions of the NBU]. Retrieved from: (in Ukrainian)
  9. Ofitsiynyy sayt Natsionalʹ  noho banku Ukrayiny [Official site of the National Bank of Ukraine]. Retrieved from: (in Ukrainian)
  10. Makroekonomichnyy  ta  monetarnyy  ohlyad  Natsionalʹ  noho  banku  Ukrayiny,  berezenʹ    2020  roku [Macroeconomic  and  monetary  review  of  the  National  Bank  of  Ukraine,  March  2020].  Retrieved  from:    (in    Ukrainian)
  11. Rezulʹ taty valyutnykh interventsiy NBU. Ofitsiynyy sayt ministerstva finansiv Ukrayiny [Results of foreign exchange interventions of the NBU. Official site of the Ministry of Finance of Ukraine]. Retrieved from: (in Ukrainian)
  12. Richnyy zvit Natsionalʹ noho banku Ukrayiny za 2019 rik: 10 pokaznykiv, yak zminylasya ekonomika ta finansova systema Ukrayiny [Annual Report of the National Bank of Ukraine for 2019: 10 indicators of how the economy and financial system of Ukraine have changed]. Retrieved from: annual_report_2019.pdf?v=4. (in Ukrainian)