Ukraine monetary base grows 0.8% in August

Ukraine’s monetary base grew 0.8% m/m (6.4% YTD) in August from 0.6% m/m in the prior month, according to a National Bank of Ukraine (NBU) report on Sept. 12. Money supply (M3) increased 0.3% m/m in August (+5.4% YTD) from 0.8% m/m in the prior month.

Alexander Paraschiy: It’s not clear what fueled money creation last month. The NBU stopped injecting hryvnias through ForEx interventions, producing a net result of USD 13.4 mln in sales in August compared to USD 257.8 mln in purchases in July. What’s more, we haven’t observed any evidence on expanded fiscal spending as Treasury residuals were reported increasing 16.1% m/m in August.

The monetary base grew at a YTD rate of 6.4% in 8M16, somewhat faster than the +7.6% YTD rate we projected for 2016. So we could be making revisions once more detailed money aggregates data is released.