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Ukraine monetary base dips 0.1% m/m in August

Ukraine's monetary base dipped 0.1% m/m in August after a 0.6% m/m decline in July, the National Bank of Ukraine (NBU) reported on Sept 11. For 8M17, the monetary base dropped 0.7% YTD.  Money supply fell 0.9% m/m (0.2% YTD growth for 8M17) from a 1.0% m/m increase in the prior month. 


Alexander Paraschiy: Accumulating funds at treasury accounts pulled the monetary base down last month. In August, treasury residuals surged 39% to UAH 61.2 bln, thus withdrawing UAH 17.1 bln from the market. The tendency was partially offset by NBU interventions at the ForEx – the regulator purchased USD 234 mln net, thus injecting nearly UAH 6.0 bln to the system. Despite ongoing contraction in monetary aggregates, we still expect the monetary base to grow as soon as the government starts spending accumulated fiscal funds.  We still project a 8.6% YTD monetary base increase by the year end.
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