As of 1 May 2020, Ukraine had an equivalent of USD 25,695.0 million in international reserves, according to preliminary data. In April, they increased by 3.1%. The increase was primarily driven by the NBU’s reserves management transactions and FX market interventions.
Overall, the following drivers determined how international reserves changed during the month:
- first, the central bank’s transactions in the interbank FX market. FX demand from businesses fell sharply following a bout of panic buying in March. FX supply was more than sufficient to meet client bids, resulting in the hryvnia gaining strength and the NBU resuming transactions to ramp up international reserves. The NBU made USD 678.8 million in net FX purchases in April. The central bank stepped in to purchase foreign currency on the days that FX supply surpassed demand, generating a total USD 723.3 million in FX purchase interventions. To smooth out excessive exchange rate fluctuations that weakened the hryvnia, the NBU sold USD 44.5 million during the month.
- second, government transactions to manage public debt. Ukraine paid an equivalent of USD 303.9 million in total to service and repay its public and publicly guaranteed FX debt. That includes USD 128.6 million to service and repay FX domestic government debt securities and USD 78.0 million in Eurobond repayments. The remaining amount went to meet other commitments to international creditors. These international reserve outflows were partially offset by proceeds from the placement of an equivalent of USD 164.4 million of FX domestic government debt securities.
- third, the revaluation of financial instruments (due to changes in their market value and exchange rate fluctuations). They gained an equivalent of USD 232.0 million in value last month.
International reserves now cover 4.5 months of future imports – sufficient for Ukraine to meet its obligations, and for the government and the NBU to make their current transactions.
Data on international reserves and FX liquidity is compiled and published on a monthly basis:
- for preliminary data, no later than on the seventh day after the reporting month ends
- for revised data, no later than on the 21st day after the reporting month ends.
Revised data is available here.