Ukraine gross reserves swell 16.8% in 2016
6 January 2017
Ukraine’s gross international reserves rose 1.8% m/m (USD 268 mln) in December to USD 15.5 bln (3.7 months of future imports), the National Bank of Ukraine (NBU) reported on Jan. 5. For the year, gross reserves swelled 16.8%, or by USD 2.2 bln.
The December growth was fueled by a USD 550.4 mln local Eurobonds placement and a USD 55.1 mln loan from the EU. Spending included USD 140.9 mln of debt servicing and USD 119.4 mln of net interventions at the ForEx market.
For the year, the main sources of gross reserves accumulation were USD 1.6 bln in net purchases at the ForEx market, a USD 1.0 bln loan from the IMF and USD 1.0 bln from Eurobonds.
Alexander Paraschiy: Reserves fell short of our USD 16.0 bln forecast because a EUR 600 mln macro-financial loan from the EU has yet to be approved. Propsects for 2017 look unclear, with much being dependent on IMF funding.
Authorities are positive about the next wire of USD 1.3 bln arriving in the next several weeks because the Privatbank nationalization went smoothly. However, so far we do not see Ukraine being in the calendar of the IMF executive board meeting.
Also, we see good chances for a EUR 600 mln loan from the EU. Assuming the IMF indeed approves at least one wire, we can expect gross international reserves rising to USD 21.4 bln (4.7 months of imports) by the end of 2017
