Ukraine central bank reduces foreign currency purchase term by one day

The National Bank of Ukraine (NBU) approved on May 25 a reduction in the number of days needed to verify foreign currency purchase requests to t+1 from the t+2 rule that is active currently, according to the NBU’s web site. The new rules will take effect June 1. Importantly, the NBU will also allow importers to decide for themselves whether they want to purchase foreign currency within 30 days after gaining permission. Currently, foreign currency must be purchased promptly after the NBU grants permission.

Recall, a day before, the head of the open market department at the NBU, mentioned that the NBU is also considering reducing the percentage of the obligatory sale requirement of export proceeds in June, which is currently 75%.

Alexander Paraschiy: The NBU is continuing to gradually liberate Ukraine’s foreign currency exchange market. These measures will simplify life for business and strengthen confidence in the national currency. The NBU is also considering stronger ForEx liberalization by lifting more restrictions and control measures (like abolishing the 90-day requirement for returning export proceeds). However, further accumulation of gross reserves is a critical precondition from the IMF if foreign currency restrictions are lifted more aggressively.