How the situation in Ukraine affected world currency rates

More than three weeks have already passed since the start of hostilities on the territory of Ukraine; this event has radically affected the situation on world markets.

After the panic on the main exchanges has subsided, one can soberly assess the existing exchange rates, and most importantly, the impact that the conflict has on the economies of the countries participating in it.

In addition to the ruble and the hryvnia, a week after the start of hostilities, the Polish zloty also fell significantly, the fall was about 15% to 4.60 zlotys per US dollar.

Now there has been a rollback, and the price of the USD/PLN currency pair is currently 4.28 zlotys per dollar, which is still higher than on February 23, 2022.

It can be assumed that after the rollback, the zloty will continue to fall again and the reason for this lies not only in the fact that Poland borders Ukraine, but also in the disappointing situation in its economy.

Since the beginning of the year, inflation in Poland has been breaking records, and a million Ukrainian refugees are only increasing the burden on the Polish budget. Many plants and factories have reduced their production due to problems with components or lack of personnel.

Therefore, we can predict a decline in the zloty exchange rate to 4.8 in the very near future.

The Swiss franc, unlike the Polish zloty, went up; at its peak, it was almost equal to the euro. Thanks to this, the historical minimum for the EUR/CHF currency pair was broken:

The reasons for the strengthening are quite obvious; the Swiss franc has always been in great demand during times of global instability. This happened this time too, which led to its strengthening.

However, it should be noted that further strengthening should not be expected; investors have already transferred their savings to Swiss francs and the demand for this currency has decreased.

The euro currency, despite the unfavorable forecasts for the European economy, has practically not lost its position:

It is quite likely that the EURUSD currency pair will drop to the level of 1 US dollar closer to summer. This is also due to the fact that the US economy suffered the least from the severance of economic ties with Russia, and this plays into the hands of the dollar.

The situation with the Chinese yuan is not entirely clear; now the yuan exchange rate has not decreased significantly and is 6.36 yuan per dollar:

But this state of affairs will not last long; there are two options for events. In the first option, the West will begin to demand a severance of relations with Russia and introduce stations, which will lead to an even greater weakening of the Chinese yuan.

The second option is more optimistic; if the parties to the conflict manage to come to an agreement, then China will be able to win significantly by supplying scarce goods to Russia and Europe.

As for the Russian ruble exchange rate, the current strengthening is a correction of the downward trend, and it is unlikely that the Russian ruble will be fixed at 100 rubles per US dollar for a long time.

Stabilization of the exchange rate should be expected only after the signing of a peace treaty between Russia and Ukraine. At the same time, the exchange rate of other currencies may also change dramatically.