Currency Liberalization as a Necessary Prerequisite for Ukraine's Integration Into the International Economic Area

Abstract

The article examines the introduction of currency liberalization by the National Bank of Ukraine and its impact on the economic development of Ukraine. Liberalization of the currency regulation mechanism is an urgent direction of economic reform, as it contributes to Ukraine's integration into the global financial space. The introduction by the National Bank of Ukraine of gradual liberalization of currency regulation should promote the inflow of foreign capital from economically developed countries of the world. The article aims to study the peculiarities of the application of the regime of liberalization of currency regulation and to determine its impact on the economic development of the country. Analysis of the activity of the National Bank of Ukraine on the foreign exchange market in recent years showed that the NBU significantly changed the system of currency regulation by liberalizing the currency policy. Successful liberalization of currency regulation can ensure financial openness of the country under the conditions of weighted macroeconomic regulation it is noted. The updating of the system of currency legislation made it possible to provide more than 30 currency relaxations. The impact of currency liberalization on the most important macroeconomic indicators – money supply, monetary base, GDP was studied. Dynamics of exchange rate fluctuations, price level, currency interventions were analyzed. It was noted that currency interventions are associated with changes in the demand for currency in different periods. The purchase and sale of currency by the National Bank of Ukraine allows regulating the amount of money in circulation, which directly affects the level of inflation in the state. It has been established that the liberalization of currency regulation should be balanced and controlled by the state, because during the aggravation of crisis phenomena, the implementation of liberalization will only worsen the state of the real sector of the domestic economy. For Ukraine, taking into account the specifics of economic development, the liberalization of currency policy is an objectively determined process. However, liberalization may contain significant threats and risks. Therefore, it is important to develop an effective mechanism for the implementation of the liberalization process, taking into account the peculiarities of the domestic economy.