Preliminary data showed that, as of 1 February 2020, Ukraine's international reserves stood at USD 26,292.8 million (in the equivalent). In January, they went up by 3.9%, reaching their highest since November 2012. The growth was fueled by the government’s successful placement of Eurobonds and the NBU’s reserve management transactions in the FX market.
Overall, changes in international reserves during the month were driven by the following factors:
- first, the government’s servicing of public debt. In late January, the government sold EUR 1,250.0 million of Eurobonds. At the same time, the government spent USD 656.1 million (in the equivalent) on servicing and repayment of public debt denominated in foreign currency, including USD 602.2 million in repayments on domestic government debt securities denominated in foreign currency.
- second, the NBU’s interbank FX market transactions. The NBU’s purchases of foreign currency in the interbank FX market exceeded its sales by USD 98.0 million, despite a lower supply of foreign currency from exporters as they received large amounts of VAT refunds, and revived demand from importers after the holiday season’s sales. On the days that the supply of foreign currency in the FX market exceeded demand, the NBU interevened, purchasing a total USD 348.0 million, including the USD 248.0 million bought at a single exchange rate and the USD 100.0 million purchased at the best available rate. To smooth out excessive exchange rate fluctuations that weakened the hryvnia, the NBU sold USD 250.0 million in January by intervening at a single exchange rate.
- third, the revaluation of financial instruments (due to changes in their market value and in the exchange rate of the hryvnia against foreign currencies). Last month, the value of financial instruments increased by USD 170.6 million (in the equivalent).
International reserves covered 3.9 months of future imports. This was sufficient for Ukraine to meet its obligations, and for the government and the NBU to conduct their current operations.
Data on international reserves and foreign currency liquidity are compiled and distributed on a monthly basis:
- for preliminary data, no later than on the 7th day following the reporting month
- for revised data, no later than on the 21st day following the reporting month.
Revised data are available here.