KIEV—Ukraine’s currency slid 8.9% against the U.S. dollar on Friday, a day after the central bank’s decision to abandon what was effectively a currency peg sent it tumbling.

The hryvnia plummeted to a new low of 25.1 hryvnias per dollar on Friday afternoon closing at 23.7, according to central-bank data. It lost more than one-fifth of its value against the greenback on Thursday after the National Bank scrapped foreign-currency auctions that provided unofficial support for the exchange rate.

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