Voices from Russia

Tuesday, 3 March 2015

NBU Hiked Rate to 30 Percent, In Fruitless Attempt to Avert Hyperinflation and Currency Plunge

00 Ukrainian grivnya. 03.03.15

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The National Bank of the Ukraine (NBU) raised its benchmark interest rate to 30 percent from 19.5 percent, the biggest increase in 15 years. It reflects its attempt to save a collapsing economy from hyperinflation that some estimate at 272 percent. On Tuesday, the NBU said that the new refinancing rate would start on Wednesday. This is the second rate increase this year, as the bank raised it in February to 19.5 percent from 14 percent. NBU chief V А Gontareva said in a media briefing that they took the decision because they saw the “threat of inflation had risen strongly due to negative consequences from currency market panic”. The bank also kept in place the requirement for companies to sell about 75 percent of their forex earnings, which they hope would stabilise the grivnya. Gontareva hopes that it’d will return it to a level of 20-22 to the US dollar “quickly”. The grivnya lost about 70 percent of its value since the start of the Maidan unrest a year ago. On Tuesday, it traded at 26 grivnya/USD {it’s bouncing between 24 to 27/USD today… it appears that the USA is propping it up. If so, for how long?: editor}; a year ago, a greenback bought 8 grivnya. This pushes up inflation, with official numbers showing prices rising by 28.5 percent in annual terms. However, separate research by Johns Hopkins professor Steve Hanke suggests that the real inflation rate is 272 percent, the world’s highest, well above Venezuela’s 127 percent rate.

3 March 2015

RT

http://rt.com/business/237229-ukraine-rate-inflation-hryvnia/

Wednesday, 25 February 2015

Junta Imposes Rationing… “Baloney Dollar” Grivnya Induces Rush on the Shops

00 Vladimir Nenashev. The Queue. 2000s

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On Wednesday, UNN reported that Ukrainian shops imposed rationing of basic products after the drastic fall in the value of the grivnya. The currency lost 70 percent of its value, causing people to stockpile food and buy electronics as a hedge. Restrictions apply to cooking oil, flour, and sugar. Retailers may sell no more than two bottles of sunflower oil and two packs of buckwheat per customer, and, depending on the store, from 3 to 5 kilogrammes (6.6-11 pounds) of flour and sugar. Bread, rice, potatoes, meat, and milk aren’t yet rationed, but aren’t so plentiful on the shelves. Stores also saw higher demand for household appliances, as people consider consumer electronics an investment as prices increase daily. Experts think that Ukrainian inflation could be 27 percent by the end of 2015.

Grivnya’s Fall

The dramatic depreciation of the grivnya triggered the rush to buy; it lost 70 percent of its value against other currencies in just a year. The conflict in Novorossiya and international reserves only enough to last for two months are key reasons for the currency’s downward spiral. The devaluation accelerated after the National Bank of the Ukraine (NBU) let the grivnya float in early February. Currently, the Ukraine is in a deep political crisis reflected in its economy and budget. The country is balancing on the brink of default. “Prime Minister” A P Yatsenyuk says that the Ukraine’s task for 2015 is “to survive” and that all people would face tough challenges no matter what their place in society. According to the NBU, the country’s GDP plunged by 7.5 percent in 2014.

The minimum weekly wage in Ukraine is 1,218 Grivnya (2,675 Roubles. 272 Renminbi. 2,700 INR. 43.50 USD. 54 CAD. 55.20 AUD. 38.30 Euros. 28 UK Pounds), which is 93 percent of the wage in Bangladesh, Ghana, and Zambia at 46.60 USD (2,870 Roubles. 292 Renminbi. 2,900 INR. 58 CAD. 59 AUD. 41 Euros. 30 UK Pounds. 1,305 Grivnya). The official exchange rate set by the NBU for 24 February is 28.29 Grivnya/USD and 31.96/Euro. Exchange offices sell the USD at more than 40 Grivnya and the Euro at about 50. In an attempt to stop the currency’s free fall, the NBU stepped up its currency controls Wednesday, preventing banks from buying any foreign currency for clients this week and limiting what they could buy for themselves.

At Wednesday’s Cabinet meeting, Yatsenyuk criticised the decision, saying that didn’t stabilise the Ukrainian economy, “This morning I learned that the NBU on its own, without consultation, decided to close the interbank market, which surely doesn’t add stability to the grivnya”. Meanwhile, Ukrainian media reported that junta strongman P A Poroshenko called for the head of the NBU V А Gontareva to “stop messing with the exchange rate” and gave her a week to solve the issue.

25 February 2015

RT

http://rt.com/business/235375-ukraine-hryvnia-currency-crisis/

Editor:

Of course, Yatsenyuk doesn’t want restrictions on forex transactions. The corrupt bastard is turning his assets into USD and Euro in preparation for his flight abroad when the junta falls apart. Slava Ukraina! The Ukraine ain’t dead yet, but he’s getting ready for when it is. There’s rationing in Kiev and none in Moscow… the asshat bloviators at Stratfor conclude that Russia’s falling apart! They’re nothing but politically correct (in a rightwing sort of way) water-carriers for Know Nothing trash like Ted Cruz and Marco Rubio, dontcha know. If Moscow’s going down, I’ll check into Bedlam with Mr Scrooge…

The Ukrainian SSR was the jewel-in-the-crown of the USSR… today, it’s on a level lower than Dogpatch or East Bumfuck. Let’s see… haven’t the Uniates been given free rein over the last 24 years? What does that tell you about “Galician Consciousness?” I know what it tells me…

BMD

Saturday, 21 February 2015

Death Throes of the Grivnya

00 Grivnya down the hatch. 21.02.15

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On 20 February, silent panic reigned at Ukrainian currency exchanges; at times, it became outright hysteria. During the day, the grivnya fell in value against all major currencies. Bidding opened relatively “low”, 1 USD bought 27.5 grivnya. By midday, the USD stormed the mark, reaching a level of 30 grivnya per dollar. By the end of trading, the situation “stabilised”… 1 USD bought 29.7 grivnya… a result of the “greenback” sliding a bit, adding 2.20 grivnya to its value. The rouble and the euro also reached new heights against the grivnya. Immediately, financiers commented that the Cabinet and the National Bank are looking for new ways to save the situation… the people and importers weren’t ready for such ruinous forex rates. The latter is true… companies that previously yielded generous foreign currency earnings are now idle, but the country is critically dependent on many imported goods, including energy. Energy is a major factor… price increases in energy automatically tote up higher prices for everything else.

Experts consider the rate of 30 grivnya to 1 USD to be critical. If it goes higher, there’s serious risk of total economic collapse, coupled with rampant hyperinflation. At the same time, the Ukrainian treasury is broke and can’t support the currency. Now, the Ukraine is very close to the mark that the rouble was a year ago. In principle, the rate of 30 roubles per 1 USD in the Russian case was less serious than the situation with the grivnya. Let’s start with the fact that, in absolute terms, Russian salaries and pensions are higher than those in the Ukraine are. For example, a Russian provincial pensioner gets 5,000 roubles (500 Renminbi. 5,020 INR. 80 USD. 102 CAD. 104 AUD. 70 Euros. 52 UK Pounds), and an unskilled manual labourer gets 7,000 roubles (700 Renminbi. 7,028 INR. 112 USD. 143 CAD. 146 AUD. 98 Euros. 73 UK Pounds). In the Ukraine, a pensioner gets around 1,000 grivnya (2,210 Roubles. 224 Renminbi. 2,220 INR. 36 USD. 45 CAD. 46 AUD. 32 Euros. 24 UK Pounds); a worker gets about two to three times more (4,410-6,630 Roubles. 448-672 Renminbi. 4,440-6,660 INR. 72-108 USD. 90-135 CAD. 92-138 AUD. 64-96 Euros. 48-72 UK Pounds). Of course, Ukrainian food prices are lower, but gasoline is higher… add 5-10 roubles per litre to the price over the Russian amount. As for rent and utilities, the IMF demands in the near future will make it cheaper for the average Ukrainian to rent a flat somewhere in Russia instead of paying post-Maidan prices in the Ukraine. A year ago, the Ukrainian living standard wasn’t much worse than the Russian was. Lower prices offset lower salaries, but now prices will rise to at least the Russian level. As income stagnates, salaries will become worthless. This is a logical outcome of the European dream and the demonic goat dances on the square… the dreams of a Western living standard… well, that evaporated…

21 February 2015

Viktor Pastushenko

Segodnya.ru

http://www.segodnia.ru/print/156891

Thursday, 5 February 2015

BREAKING NEWS… Grivna in the Shitter after Central Bank said it Could No Longer Support Currency

00 ukrainian money 01. 05.02.15

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The Grivna lost 34 percent against the USD after the head of the central bank signalled it could no longer support the currency with regular interventions and would allow greater fluctuations. On Thursday, National Bank of the Ukraine (NBU) Governor V А Gontareva told reporters in Kiev, “Get used to market volatility”. According to a statement published Thursday, the NBU “is changing its approach to monetary policy, while strengthening its rigidity”, as foreign exchange reserves are only 7.5 billion USD (501 billion Roubles. 46.8 billion Renminbi. 465 billion INR. 9.3 billion CAD. 9.6 billion AUD. 6.6 billion Euros. 4.98 billion UK Pounds). After the policy shift announcement, the Grivna fell to 24.5/USD and 28.092/Euro. The bank also announced an interest rate hike to 19.5 percent from 14 percent, in a move to mend the worsening economic situation. Foreign exchange reserves are at a ten-year low of 7.5 billion USD, down more than 60 percent since last year. In December, reserves stood at about 10 billion USD (668 billion Roubles. 62.4 billion Renminbi. 620 billion INR. 12.4 billion CAD. 12.8 billion AUD. 8.8 billion Euros. 6.64 billion UK Pounds). Simon Quijano Evans head of emerging markets research at Commerzbank in London, told Reuters “It’s more about economic failings and the war situation at this stage. Interest rates won’t make any difference, just as they aren’t in Russia”. The NBU decided to scrap the indicative exchange rate on Monday.

5 February 2015

RT

http://rt.com/business/229607-ukraine-hryvnia-free-fall/

Editor:

The oligarchs are plundering the foreign exchange reserves before the whole enterprise falls into the shitter. Note that this happened just as Kerry stepped into Kiev. The guy has the Reverse Midas Touch! Everything that he touches turns to shit! The Ukraine ain’t dead yet… but it soon shall be, and everybody knows it… especially, Kolomoisky and Clan Balogh. If you wonder where the money went… start lookin’ there… you might get an education. How much of it did Klichko sock away in Germany? He’s got a German passport, dontcha know…

Just you watch… after the whole ramshackle affair falls, the Galician Uniates and schismatic Orthodox will claim that it collapsed because “it wasn’t Ukrainian enough”… I shit you not. They’ll blame the Jews, the Magyars, the Poles, and (of course) the Russians. In their minds, they’ve NEVER committed any mistakes… no, siree… I’ve seen ’em up close and personal, and I’d say that I’m not the only one to think like that.

BMD

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