Destabilization of political situation affects economy, Azarov says

Destabilization of the political situation in the country, blocking government activities by the opposition will affect economic indicators, including the exchange rate. This announcement was made by Prime Minister Mykola Azarov, who said that if the Euromaidan participants had been worried about the hryvnia exchange rate, they would have continued to study and work, instead of going the square to protest. Any destabilization of the political situation affects primarily economic indicators, including the exchange rate, he said, the Information-Analytical Bulletin of the cabinet of Ministers of Ukraine reports.

Azarov also noted that the loss of exchange rate and monetary stability meant increased costs for domestic producers and increased budget expenditures, as Ukraine will have to pay more for foreign liabilities. As a result, Ukrainian citizens people will become poorer, because in absolute terms, if their income was correlated to the dollar, then, of course, any rate change would damage real purchasing power.

At the same time, as was officially reported by the National Bank of Ukraine (NBU) Chairman Igor Sorkin, the central bank possesses adequate resources to ensure stability of the banking system and the national currency.

Sorkin challenged claims of certain media sources about the NBU’s decision to restrict turnover on the monetary, credit and currency markets. He stressed that throughout its history, the NBU has repeatedly proven its ability to ensure the stability of the banking system and had always met its liabilities. If necessary, the NBU is ready to be actively present on all monetary markets to cover any possible imbalances. Given the current situation, experts  positively appreciate the statement of the NBU’s head.