Ukraine gross reserves reach USD 31 bln in 2021

Ukraine’s gross international reserves increased USD
1.8 bln in 2021, or 6% yoy, reaching USD 30.9 bln, the National Bank of Ukraine
(NBU) reported on Jan. 6. The reserves growth was due to the government’s
international borrowing and the NBU’s purchase of the foreign currency at
Ukraine’s forex market.

In December, gross international reserves increased
USD 0.3 bln, or 1.1% m/m mostly due to the government’s borrowing. Total
government inflows in foreign currency in December amounted to USD 1.4 bln,
including USD 858 mln from the placement of local Eurobonds and USD 105 mln
from the World Bank.  At the same time, the servicing and the redemption
of debts called for USD 848 mln, including USD 588 mln for the redemption of
local Eurobonds.

The NBU’s net sale of foreign currency at Ukraine’s
forex during December amounted to USD 153 mln. The NBU also reported a USD 23
mln decline in the value of its securities portfolio during the month.

As of Jan. 1, Ukraine’s gross reserves amounted to 4.1
months of imports, the NBU said.

Evgeniya Akhtyrko: The government’s major outlay in foreign currency in January will be
the redemption of local Eurobonds for USD 177 mln on Jan. 15. At least a
portion of this payment will be rolled over by new placements of local bonds
during the month. The change in gross international reserves will also depend
on the situation at Ukraine’s forex market. Should the turbulence at the market
continue, the NBU is likely to spend more for its operations at the market.