Ukraine gross foreign reserves inch up 1.4% in November

Ukraine’s gross international reserves inched up by USD 186 mln, or 1.4%, to USD 13.2 bln in November, the National Bank of Ukraine (NBU) reported on Dec 4. The main sources of reserves increase were a USD 650.5 mln swap operation and USD 9.5 mln in hard currency purchases at the ForEx. The main spending was on ForEx interventions (USD 143.1 mln), debt servicing (USD 129 mln), and IMF redemptions (USD 55.5 mln).

Alexander Paraschiy: The delayed IMF support has kept gross international reserves almost flat. Since Ukraine’s adoption of realistic 2016 budget (with a deficit of no more than 3.7% of GDP) is critical for the Fund, we can hardly expect the next wire arriving in December. So gross international reserves will stay near USD 13 bln (close to three months of imports) by the end of 2015. At the same time, we expect the delayed funding from the IMF and other donors to catch up in 2016 in what will enable gross international reserves to swell to USD 22.7 bln (nearly 5.3 month of imports).