Ukraine’s gross foreign reserves fall USD 0.86 bln in April

Gross international reserves of Ukraine declined by USD 859.7 mln in April to USD 14.2 bln (1.9 months of future imports), according to National Bank of Ukraine (NBU) data released on May 7. 

Alexander Paraschiy: The IMF redemption in April (near USD 660 mln) was the main reason of gross reserves decrease throughout the month. Given that the IMF has approved the agreement with Ukraine and that the first wire (USD 3.2 bln) has already arrived in the country, we should see a reverse of the declining trend on gross reserves from May.  In particular, the Cabinet anticipates a USD 5 bln financial inflow in May which should include also nearly USD 2 bln in loans from the EU and U.S. What’s more, if the IMF program runs smoothly, Ukraine can count on a promised extra USD 4.2 bln in loans from the Fund by the year’s end. All in all, we expect gross reserves increasing to USD 22.3 bln (3.0 months of imports) by the end of 2014.