Preliminary data suggest that as of 1 March 2019 Ukraine’s international reserves amounted to the equivalent of USD 20,220.3 million. In February, despite the favorable situation in the foreign exchange market, they decreased by 2.9% due to significant amounts of public debt repayments. The following factors had been determining the developments of the value of international reserves during the month:
- First, repayment of Ukraine’s public debt. Spending on servicing and repayment of public and publicly guaranteed debt in foreign currency amounted to USD 1285.4 million in the equivalent.
This amount includes an equivalent of USD 837.8 million for servicing and repayment debt on external and internal government loan bonds (USD 771.2 million) and other liabilities of Ukraine in the foreign currency. In addition, the Government and the NBU paid an equivalent USD 447.6 million on liabilities to the International Monetary Fund.
The cost was partly offset by earnings from the placement of domestic government bonds in foreign currency amounting to USD 302.7 million.
- Second, FX market conditions were favorable. The NBU’s net FX purchases in the interbank market increased the reserves by USD 326.5 million.
In February, as in January, the FX supply was generally higher than demand, in particular due to the stable inflow of foreign exchange earnings from exporters, the net sale of FX to banks by individuals, as well as the inflow of non-resident funds in the hryvnia government securities. This enabled the NBU to purchase USD 329.5 million in the interbank FX market, including USD 220.0 million at the best price, without influencing hryvnia exchange rate movements, which were shaped by underlying factors. To smooth out exchange rate fluctuations, within a month, the NBU sold only USD 3.0 million through foreign exchange interventions at the best price.
- Third, the revaluation of financial instruments (change in the market value and in the exchange rate of the hryvnia against foreign currencies). Last month, the value of financial instruments increased by USD 56.7 million (in the equivalent).
As of 1 March 2019, the international reserves covered 3.3 months of future imports and were sufficient for Ukraine to meet its obligations and for the government and the NBU to conduct their current transactions.
Data on the international reserves and foreign currency liquidity are compiled and distributed on a monthly basis:
- no later than on the seventh day following the reporting month – for preliminary data
- and revised data, compiled and distributed no later than the twenty-first day following the reporting month.
Revised data are available here.