Dollar exchange rate
Oleksandr Okhrymenko
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| PHÎÒÎ: UNIAN |
President of the Ukrainian Analytical Center
There is a high probability that in the coming months the dollar will remain at the level of 8 hryvnia, give or take a few kopeeks, to which nobody will pay any attention anyway. The rate will fluctuate between UAH 7.92-7.96 and will unlikely to exceed the UAH 8 threshold. There are not likely to any elections or global factors, meaning that the rate will most likely freeze for the summer. Though the dollar is obviously undervaluated today, the central bank will restrain the strengthening of the hryvnia. Such will be the situation and such will be the budget bill and even the government will be in favor of applying all possible levers to freeze the exchange rate. The fact is everybody is saying that today the hryvnia can only strengthen but this is not convenient for exporters and this is why neither government nor business is interested in the strengthening of the national currency. And it is precisely for this reason that the policy of the NBU is for the stability of hryvnia, provided there are no disasters such as the collapse of the coalition.
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| PHÎÒÎ: PHL |
Loans
Borys Tymonkin
COB of UkrSotsBank
The situation with loans is unlikely to improve. If anybody will be issued loans, it will be legal entities. Physical persons will be issued loans only if there is money left over. Interest rates on loans where a person is lent money without any preferences will be set at 25%, meaning it will slightly fall. Today, the rate is 30%. So, one can forget about cheap loans at least until the fall. The situation may change in only one case, namely if the NBU once again permits the issuance of hard currency loans. Then they will cost 13-17% for physical persons. In the best case scenario, the hryvnia rate on loans may fall to 22%. But this is not likely to happen, since legal entities will take out the bulk of the money on loan and there will be no sense in lowering rates for physical persons.
Mortgages are frozen for the time being, as banks accumulated too many unfulfilled pledges and one is better off forgetting about a mortgage altogether. Today, a mortgage loan can be issued at no less than 25% per annum and no more than for three years. And this is only if a borrower is short on collateral by 10%. In other cases an applicant for a mortgage loan will be rejected. Finally, the mortgage market will return to its pre-crisis level no sooner than in five years.
Deposits
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| PHÎÒÎ: UNIAN |
Volodymyr Khlyvniuk
COB Finansy i Kredyt
Interest rates on deposits will shrink. At the moment with a stable dollar, the interest rate on hard currency deposits is much too high. I think the rate on hard currency deposits will not exceed 10% by the end of the summer. More than half the deposits today are short-term and in any case mature this year. When people extend their deposits, naturally no bank will offer them the same high interest rates at the peak of the crisis. Money today is pretty expensive as it is and banks do not need it in this form. With a stagnant dollar and the inability to issue loans at such excessively high interest rates of 11-15%, banks are practically operating in the red. Interest rates on deposits in hryvnia will also fall, but not as much. The most powerful conservative banks will offer no more than 15-17% but such rates as 22% and 25% will naturally be offered somewhere on the market.
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| PHÎÒÎ: PHL |
Gasoline
Serhiy Kuyun
Director of the A-95 consulting company
The Ukrainian motor fuel market totally depends on the foreign market. It is for this reason that it is very difficult to forecast the situation in the future. At the moment, very few can understand what is happening on the global oil market. I, in particular, can point only to a fairly large price corridor of – UAH 8 – 10 per 1 liter of gasoline. If the price per barrel of oil is hiked by US $90, gasoline in Ukraine will cost a bit more than UAH 9 per liter. There is one thing I am sure of, regardless of the global oil market: gas prices will definitely grow as the government will raise excise duties. Excise duties on motor fuel will soar from EUR 110 to EUR 170 per tonne for high-quality gasoline, in accordance with the bill submitted for review by special committees in the Rada. Excise duties on low-quality fuel containing sulfur will cost EUR 190 per tonne. In the retail sales network the cost increase will become tangible the next month after the law takes effect. It is possible that average prices per 1 liter of fuel at gas stations will be raised by UAH 0.60 and prices per 1 liter of diesel fuel – by UAH 0.65.
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| PHÎÒÎ: Private archive |
Real estate
Vitaliy Kotenko
General Director of the Planet Obolon real estate agency
By the fall of 2010, real estate prices will be adjusted upward only due to inflation. The average price of transactions is also likely to slightly grow. But this growth does not have economic justification, as it is not associated with a rise in incomes. This technical growth is associated with the fact that every new seller sets prices slightly higher than those of their competitors on the market. Nevertheless, thanks to this mechanism of increasing prices in the segment of affordable housing, prices may grow by 5-8% over the summer. Currently, the average selling price of housing in Kyiv practically does not differ from prices in July 2009 (around US $1,800 per square m). Kyiv is the nation’s capital, at any rate. Judging by the latest opinion polls, about one-fourth of Ukrainians would want to live in Kyiv. As soon as interest rates on loans drop to a reasonably affordable level, housing prices in Kyiv will once again shoot upwards.
Car sales
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| PHÎÒÎ: UNIAN |
Oleh Nazarenko
General Director of All-Ukrainian Automobile Importers
and Dealers Association
The Cabinet will submit to the VR a number of bills on raising excise duties, including duties on imported vehicles, together with the draft 2010 National Budget. First of all, this will have an impact on the prices of cars with engine volumes of more than 3 liters and costing more than EUR 50,000, the excise duty on which will double from EUR 1-2 per cu. cm. As a result, the prices of luxurious sedans, SUVs and sports cars with 4 to 7 liter engines will raise at least EUR 5,000 – 7,000. But that’s just peanuts, as bigger problems are just ahead for official car dealers and importers. The first alarm bell for them is the cancellation of the Kyiv Automotive Show International Car Salon at the end of May, which traditionally attracted the rich folks and presented the most illustrious samples of the automotive industry from all over the globe, such as Bentley, Rolls Royce, BMW, Lamborghini, Porsche, etc. On the other hand, the “grey” import of luxury cars is getting its second wind and then the national treasury will be short of tax revenues, which were received even during the hardest times of crisis. At present, the VR is reviewing another package of bills that will be beneficial for “grey” importers. For example, the renewal of temporary import of vehicles purchased abroad and privileges for disabled people and members of their families.
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