Why did Ukraine’s currency crash 30% in Feb ’15?

  • Central Bank abandoned "managed float" - so hyrvnia (UAH) now floats freely against other currencies.
  • Up until 05 Feb 2015, under the managed float, when people wanted to sell UAH & buy USD, the Central Bank would buy those UAH (and sell them USD), so value of UAH would be roughly-ish maintained.
  • But the Central Bank started running out of USD (foreign exchange reserves) hence the move to a "free float".
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