Influence of Macroeconomic Indicators on the Currency Exchange Rate: Regression Analysis

The article analyzes the influence of macroeconomic indicators on the national currency rate with the help of regression analysis. The purpose of the article is to statistically assess the relationship between the exchange rate of the national currency and the main macroeconomic indicators of the state. In the process of research, the following methods of scientific cognition have been applied: analysis and synthesis, logical induction and economic-mathematical modeling. The article outlines the main concepts that allow explaining the laws of changing exchange rates. A regression analysis of macroeconomic factors that influence the formation of the price of currency has been carried out. Also, the analysis of the dynamics of the exchange rate of hryvnia in relation to macroeconomic indicators has been carried out, which allowed to identify the main stages of the exchange rate and establish the fundamental factors of the exchange rate of the hryvnia against the US dollar at each of the stages. The use of correlation analysis has made it possible to establish that between the exchange rate of hryvnia against the US dollar and external debt, there is a significant link and a lack of connection with the consumer price index. The scientific novelty of the results is that the increase in official foreign debt by 1% will lead to an increase in the national currency exchange rate by 2.85%, on average the annual appreciation of the dollar for 12 years during the years of stability before the crisis in 2008 was 14%, and the annual the growth of the dollar for 8 years after the 2008 crisis was 29%. In turn, the political crisis of 2014-2015 led to an increase in the rate of 3.43 times. From the analysis, we can state that the Ukrainian hryvnia devalued more because of a political crisis than an economic one. The practical significance of the results: among the analyzed factors, the external debt of the country, economic and political crises, as well as the money supply, the internal supply of money, balance of payments, budget volume, the currency policy of the state and the degree of confidence in the currencies are significantly influenced by the foreign exchange rate. Since external debt has a significant impact on the exchange rate, the primary task is to find ways to reduce public debt. Prospects for further research in this area are the development of new rules of work in the foreign exchange market in the conditions of the floating exchange rate regime and the formation of a system of insurance instruments against currency risks.