As one would have expected the Ukrainian national currency, the Hryvnia has lost its value against major currencies with the Russian invasion, but by now things have also unfolded in many ways the Russians didn’t expect.
Both the Ukrainian Hryvnia and the Russian Ruble are down around 22% against the US Dollar and the Euro since Russia invaded Ukraine early last year, however, while the UAH/USD chart seems to have stabilised at a bottom, the RUB/USD charts look as if the Russian Ruble is in a never-ending a free-fall.
Then when we check the UAH/RUB chart, something that looks interesting is that it looks as if the Russian Ruble has failed to appreciate against the Hryvnia with the war. This is undoubtedly good news for Ukraine, especially considering its economy is smaller than Russia’s and Russia is still collecting plenty of foreign currency from its oil and gas sales. As a currency, having to persevere this way against a major and bigger invader that is waging war against you, shows that there is an underlying optimism in Ukraine’s economic future, something that is deeply lacking in Russia right now.
Next time I will look at their respective government debt and government bonds and see if anything meaningful can come out of such a comparison.
Also, and of course, if I may use a Ukrainian currency note as an image, I will of course use the one that has Taras Shevchenko – the national poet of Ukraine.