Ukraine August gross reserves increase 1%

Ukraine’s gross international reserves increased 0.9%
m/m, or USD 0.246 bln, to USD 29.0 bln in August after growing 1.0% m/m in
July, the National Bank of Ukraine (NBU) reported on Sept. 8. The increase was
mostly the result of NBU ForEx market interventions.

 

The NBU did not sell foreign currency at Ukraine’s
ForEx market during the month, while its purchases of foreign currency at the
market amounted to USD 461 mln. 

 

The redemption and servicing of the state debt in
foreign currency during the month required USD 645 mln. In particular, outlays
related to the redemption and servicing of local Eurobonds amounted to USD 497
mln, while the rest of outlays were related to the IMF. At the same time, the
receipts from the placement of local Eurobonds during the month amounted to USD
251 mln.

 

The NBU also reported a USD 385 mln rise in the value
of its securities portfolio.

 

As of Sept. 1, Ukraine’s gross reserves amounted to
4.8 months of imports, the NBU said.

 

Evgeniya Akhtyrko: The
situation at Ukraine’s ForEx normalized quickly in August after the increased
turbulence in July, and this allowed the NBU to intensify the purchase of
foreign currency. This also helped to compensate for the foreign currency
outlays related to the redemption and servicing of the state debt while the
receipts from newly placed local Eurobonds during the month were relatively
weak.

 

In September, the major foreign currency outlays
include the redemption and servicing of international Eurobonds for USD
2.1 bln. In addition, Ukraine will have to repay around USD
419 mln to the IMF.

 

We expect the NBU to be an active buyer of foreign
currency at Ukraine’s ForEx market as long as the situation at the market
allows. In addition, MinFin plans at least one placement of local Eurobonds
during September. These operations will partially help to compensate for the
international reserves losses related to debt repayments.

 

With these ins and outs, we expect gross
international reserves to get leaner by at least 5% in September.