- Ukraine’s international reserves reached its maximum since the beginning of 2014
The UX index decreased by 0.4% yesterday while the PFTS index increased by 1.3% (in UAH terms). The WIG-Ukraine increased by 0.4%. On the interbank exchange market, the USD/UAH was up by 0.2% to UAH 25.93 (mid price), according to Thomson Reuters. The official exchange rate reported by the NBU was UAH 25.91.
Ukraine’s international reserves reached its maximum since the beginning of 2014.
According to the preliminary information provided by the National Bank of Ukraine (NBU), during the August 2017 Country’s international reserves grew by USD 240 mn (+1.3% m/m) to USD 18,035 mn. Since the year beginning, reserves grew by 16.1%. There were two main sources of the reserves replenishment during the previous month. First of them is the issuance of local bonds denominated in U.S. dollars for the total amount of USD 351.5 mn. Another one is a net purchase of USD 234.0 mn on the interbank market through the foreign currency interventions. During the August 2017, NBU had spent USD 498.8 mn to service its liabilities. In particular, the sum of USD 448.7 mn was paid to the International Monetary Fund (IMF), while another part of the foreign currency debt was paid off in the amount of USD 50.1 mn. As for September 1, 2017, the amount of international reserves covers 3.6 months of future imports and all current foreign obligations of the Central Bank and the Government.
The international reserves recovered after the decline in July and renewed growth, despite the expectations of their reduction due to a significant pressure of debt repayments in August 2017. Our current expectations for the reserves dynamics for September are not so optimistic, as the Government has already spent USD 505 mn to service its Eurobonds. In addition, if the tendency of Hryvnia weakening continues in the future, NBU will probably spend some reserves to hold the local currency’s devaluation.
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