Ukraine devalues currency by 25 per cent

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Ukraine's central bank has devalued the hryvnia currency by 25 per cent relative to the US dollar, citing the country's difficult situation in the midst of an invasion by Russia and also due to the US dollar's rising strength.

The statement added that the exchange rate would remain fixed to allow the bank to better control inflation and guarantee the stability of the financial system.

The statement cited bank governor Kyrylo Shevchenko saying that "this is a key condition for a stable functioning of the economy, which is vital during times of war".

The central bank will also tighten controls on moving capital abroad, limiting the amount Ukrainians are allowed to send abroad to below the equivalent of $US821 ($A1,190) a month.

Previously, the permitted sum had been three times as high.

The hryvnia's exchange rate was frozen by the central bank shortly after the onset of the Russian invasion, which began in late February.

However, rates in currency exchange shops had recently differed by about 25 per cent from the official rates.

Ukrainian media speculated that the move was designed to help close spending deficits, as financial help from abroad is now worth more in the hryvnia currency.

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