No Currency Panic at the End of 2025: How the NBU Manages the Dollar and Euro
“Time for Action” analyzed the state of Ukraine’s foreign exchange market as 2025 comes to an end and why the traditional Christmas and New Year factor has not become a source of exchange rate stress this time. Despite the war, budget spending, energy risks, and the seasonal increase in hryvnia liquidity, the market is showing relative equilibrium, while key exchange rate parameters remain manageable and predictable.
The end of the year is usually accompanied by increased demand for foreign currency. Seasonal payments annual bonuses, premiums, and dividends increase the amount of hryvnia in circulation and traditionally push part of the population and businesses to buy dollars or euros. At the same time, December also brings the opposite mechanism: a significant share of citizens convert foreign currency savings into hryvnia to finance holiday spending. It is precisely the combination of these two flows that forms the balance.
According to market participants’ estimates, in 2025 average demand for foreign currency will exceed supply by only 10–15%, which is considered a comfortable and controllable level. By comparison, at the end of last year this gap reached 30–40%, which is what created heightened exchange rate pressure. As explained by Taras Lesovyi, Director of the Financial Markets and Investment Activities Department at Globus Bank, the current situation is fundamentally different and shows no signs of panic.
It is also important that December 2025 is unfolding without the inflationary hysteria that previously often fueled situational purchases of foreign currency “just in case”. Inflation dynamics remain restrained, and the National Bank’s baseline forecasts are not being revised. It is expected that by year-end, price growth will not exceed 10%, which significantly reduces incentives for panic-driven currency decisions by households and businesses.
A separate stabilizing factor has been the active deposit policy of banks. In 2025, financial institutions effectively created an alternative to foreign currency savings by offering high rates on hryvnia deposits. The start of the so-called “high deposit season” with rates up to 18% per annum led to a noticeable flow of funds into deposits. In December, the number of new depositors increased by more than 5% compared to November. This effect of “luring” money away from the foreign exchange market significantly reduced speculative pressure on the exchange rate.
Against this backdrop, the National Bank of Ukraine plays the key role in shaping the exchange rate at the end of the year. Even taking into account the increase in budget spending in the second half of December, the hryvnia exchange rate is forming within a managed scenario. As noted by Oleksandr Parashchii, Head of the Analytical Department at Concorde Capital, the regulator is interested in demonstrating a noticeable but controlled annual devaluation that corresponds to macroeconomic realities.
“Probably, it is in the NBU’s interest to demonstrate a noticeable annual devaluation of the hryvnia against the dollar (last year ended at 42.0), which corresponds to our realities. Most likely, at the end of the year we will see new exchange rate records, and the year will end around 43.0 UAH per dollar, or even higher.”
This forecast does not imply a currency crisis. It refers to a gradual movement, without sharp jumps, within a previously controlled corridor. At the turn of 2025–2026, major currencies the dollar and the euro are expected to remain in slow but stable growth, without signs of global distortions. Demand and supply are expected to stay within the same 10–15%range, and if necessary, the regulator will continue to smooth fluctuations through interventions.
The overall characterization of the current situation is “stable volatility”. Exchange rate fluctuations and the difference between buying and selling on the interbank market will remain minimal. On the cash market, the buying rate will be as close as possible to the interbank rate, while the selling rate will form within a somewhat wider corridor due to local demand spikes. According to market participants’ estimates, the spread will be around 0.5 UAH, and on some days may widen to 0.7–0.8 UAH.
Special attention should be paid to the dynamics of the euro. At the end of December and the beginning of January, it will be determined by two factors: global fluctuations of the EUR/USD pair and the domestic hryvnia-to-dollar exchange rate. It is expected that the euro-to-dollar ratio will remain within 1.16–1.17, while hryvnia quotations for the euro will fluctuate mainly within 49–49.6 UAH. If necessary, the regulator may conduct targeted interventions in euros, restraining excessive volatility.
“It is expected that the euro-to-dollar exchange rate will remain within the range of 1.16–1.17, and hryvnia quotations for the euro will fluctuate mainly within 49–49.6 UAH.”
Financial analyst Andrii Shevchyshyn points out that the NBU is currently effectively controlling the euro-to-hryvnia exchange rate, trying to keep it below the psychological level of 50 UAH. At the same time, the strengthening of the euro against the dollar on global markets automatically puts pressure on hryvnia quotations. Under these conditions, the regulator is forced to balance the situation by adjusting the dollar exchange rate.
“In turn, the dollar-to-hryvnia exchange rate will move depending on trends in the EUR/USD pair, and surprises are possible here. If EUR/USD corrects to 1.16, the dollar against the hryvnia may reach 43 UAH.”
External support has become an additional stabilizing factor. Following the European Commission’s decision on two-year financing for Ukraine in the amount of 90 billion euros, the National Bank gains more opportunities to keep the euro exchange rate within a controlled range by the end of the year.
Currency interventions by the NBU will play an important role at the end of December and the beginning of January. In the period from December 22 to January 4, the regulator is likely to maintain an active presence on the interbank market, compensating for structural excess demand. According to Taras Lesovyi, the total volume of such interventions may amount to $1.2–1.6 billion, or $600–800 million per week. Importantly, these injections are supportive rather than emergency in nature and do not indicate a systemic threat to the market.
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The beginning of January 2026, according to analysts’ expectations, will be traditionally calm. More active movements may appear from the second decade of the month. Historically, January often shows devaluation tendencies, but the regulator’s policy and the level of reserves will continue to play the key role.
“I tend toward a continuation of hryvnia weakening. Undoubtedly, the intensity of hostilities, risks to the energy sector and shelling, or a transition to a peace process will influence market sentiment and trends. At the same time, the main role will continue to be played by the NBU, which holds the exchange rate using reserves.”
Looking further into 2026, according to Yurii Krokhmal, Sales Director at Bank Avangard, the National Bank will not fundamentally change its currency strategy unless force majeure occurs. A moderate devaluation of around 10% is expected.
“By the end of 2026, the dollar exchange rate is likely to be in the range of 44–44.5 hryvnias, and the euro, due to a possible continuation of strengthening trends on international markets, may reach 53–55 hryvnias.”
The expanded conclusion of “Time for Action” is that the foreign exchange market at the end of 2025 is not in crisis mode, but in a mode of managed adaptation. The balance of supply and demand, restrained inflation, tight monetary policy with a 15.5% key rate, active deposit competition among banks, and stable external financing create the foundation for a predictable exchange rate. The key stabilizer remains the National Bank, which does not simply react to the market, but shapes its expectations. In this framework, the main risk is not exchange rate fluctuations as such, but any sudden external shock. In the absence of force majeure, the hryvnia enters 2026 without currency panic, but with a clear understanding of the price of stability.
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