Kateryna Anufriieva

Department for Monetary Relations, Institute for Economics and Forecasting National Academy of Sciences of Ukraine,

Ukraine

kateryna.anufriieva@gmail.com

Verbal interventions of the National Bank of Ukraine: The impact of exchange rate

Yuliia Shapoval

Department for Monetary Relations, Institute for Economics and Forecasting National Academy of Sciences of Ukraine,

Ukraine

shapovaljulia510@gmail.com 

Abstract. This paper focuses on central banks’ verbal interventions and takes a closer look at their impact on the exchange rate. As the main research methods, we chose statistical and sentiment analysis. The meaning of central banks’ verbal interventions is examined by clarifying the importance of transparency for monetary policy. In order to understand the extent of the research, we present a review of the most outstanding examples of central banks’ communication policies. The article assesses the transparency of the monetary policy of the National Bank of Ukraine (NBU) and generalizes foreign exchange-related indicators. The problem of expectations referred to the central monetary body, which influences communication policy, is also under consideration. We substantiate the interrelationship between the exchange rate and monetary policy trust indicators. The current research reviews regular and occasional groups of NBU’s verbal interventions and outlines that business entities are focused on the exchange rate as the main factor of consumer goods’ prices. We analyse the tendencies and effects of NBU’s announcements on the exchange rate and as a result, reflect communication strategy priorities for Ukrainian central bank.

Received: November, 2018

1st Revision: February, 2019

Accepted: August, 2019

DOI: 10.14254/2071-8330.2019/12-3/8

JEL Classification: E3, E43, E44, E52, E58

Keywords: monetary policy, central bank communication, verbal interventions, exchange rate, the National Bank of Ukraine