Ukraine gross reserves jump 4% in January

Ukraine’s gross international reserves jumped 3.9% m/m
to USD 26.3 bln in January, the National Bank of Ukraine (NBU) reported on Feb.
5. The surge was driven by a Eurobond placement and the central bank’s
operations at Ukraine’s ForEx.

The government’s operations on state debt management
in January included the placement of Eurobonds for EUR 1,250 mln.
At the same time, the government spent USD 656 mln (in the equivalent) on
redeeming and servicing the state debt denominated in foreign currency. In
particular, local Eurobond obligations in January amounted to USD 602 mln.

The NBU’s net purchase of foreign currency at
Ukraine’s ForEx during the month amounted to USD 98 mln. The NBU also reported
a USD 170.6 mln rise in the value of its securities portfolio.

As of Feb. 1, Ukraine’s gross reserves amounted to 3.9
months of imports, the NBU said.

Evgeniya Akhtyrko: The
favorable situation at the global financial markets prompted Ukraine’s
government to start fulfilling its plans on external borrowing in the very
beginning of the year. MinFin has no plans for new placements of local
Eurobonds in 1Q20, so the receipts from the placement of international
Eurobonds in January should provide comfort in making payments related to
redemption and servicing of foreign currency debt.

Foreign currency outlays in January include USD 399
mln for the redemption and servicing of local Eurobonds. February gross
reserves will depend on the NBU’s operations at Ukraine’s ForEx during the
month. If appreciation pressure on the national currency intensifies, the
central bank’s net currency purchases might offset outlays.