Ukraine’s international reserves in February, according to preliminary estimates of the National Bank of Ukraine (NBU), decreased by 3.8%, or by $1.47 billion – to $37.052 billion.
“Such dynamics is due to the NBU’s currency interventions to maintain exchange rate stability and the country’s debt payments in foreign currency, which were partially offset by receipts from international partners,” the NBU explained on its website on Wednesday.
Among other factors determining the volume of reserves, the NBU named operations in the foreign exchange market: in February, the regulator’s net sale of foreign currency amounted to $1.51 billion, which is 1.4 times less than in the previous month.
The National Bank noted that in February, $1.34 billion was transferred to the account of the Cabinet of Ministers in the NBU, while $1.13 billion was paid for servicing and repayment of state debt.
The central bank also indicated that the current volume of reserves was positively affected by the revaluation of the value of financial instruments, adding $199.5 million.
“The current volume of international reserves provides funding for 4.9 months of future imports,” the regulator stated.
As reported, the NBU in January lowered the forecast of Ukraine’s international reserves at the end of 2024g to $40.4 billion from $44.7 billion and to $42.1 billion from $45 billion at the end of 2025. For more details on the economy in Ukraine and around the world, see the video from the analytical project Experts Club – https://youtu.be/byJnfmie7bM?si=nWnf5J2CUrqaXF-j
Subscribe to Experts Club channel: https://www.youtube.com/@ExpertsClub
According to preliminary estimates by the National Bank of Ukraine (NBU), Ukraine’s international reserves decreased by 4.9%, or UAH 1.98 billion, to $38.525 billion in January. “This dynamics is due to the NBU’s foreign exchange interventions to maintain exchange rate stability, the country’s debt payments in foreign currency, and lower international aid inflows compared to previous months,” the NBU explained on its website on Tuesday.
Among other factors that determine the amount of reserves, the NBU cited operations in the foreign exchange market: in January, the regulator’s net sale of foreign currency amounted to $2.53 million, which is 29% less than the previous month.
The regulator noted that in January, the Cabinet of Ministers transferred $898.9 million to the NBU account, and paid $441.6 million for servicing and repaying the public debt.
The NBU also pointed out that the current volume of reserves was positively affected by the revaluation of financial instruments, adding $86.3 million.
“The current volume of international reserves provides financing for 5.1 months of future imports,” the central bank stated.
As reported, in January, the NBU lowered its forecast for Ukraine’s international reserves at the end of 2024 to $40.4 billion from $44.7 billion and to $42.1 billion from $45 billion at the end of 2025.
Ukraine’s international reserves, according to preliminary data, increased by $1 billion 722.7 million, or 4.4%, in December after four months of decline to reach $40 billion 507.9 million, the second highest level in history after July 2023, the National Bank of Ukraine (NBU) said on Friday.
“They grew by 4.4% compared to November due to foreign exchange earnings from international partners, which exceeded the NBU’s net sale of foreign currency and the country’s debt payments in foreign currency,” the central bank explained the rapid growth of reserves.
It is specified that in general, in 2023, Ukraine’s international reserves increased by 42%, or $12.01 billion.
Net international reserves increased by $1 billion 167.5 million, or 4.3%, in December, and in general, over the past year, their growth was 54.9%, or $10.05 billion.
The National Bank noted that in December it sold $3 billion 559.1 million in the foreign exchange market and bought back $6.1 million in reserves, so its net sales amounted to $3.553 billion, up 1.4 times compared to November and slightly higher than in October ($3.34 billion).
“The growth of the NBU’s interventions in foreign currency sales last month was primarily due to the seasonal factor, in particular, due to increased budget spending at the end of the year,” the regulator said in a release.
At the same time, the government’s foreign currency accounts at the NBU received $5 billion 546.4 million last month, while $708.2 million was paid as part of the servicing and repayment of the public debt in foreign currency.
In addition, the value of financial instruments increased by $426.7 million as a result of revaluation in December.
“The current amount of international reserves provides financing for 5.4 months of future imports,” the National Bank said.
As reported, Ukraine’s international reserves decreased for the third consecutive month in November – by 0.5%, to $38 billion 785.2 million.
The National Bank has raised its forecast for Ukraine’s international reserves at the end of this year to $38.3 billion from $34.5 billion in its April forecast.
According to the NBU’s updated estimates presented at a briefing on Thursday, Ukraine’s international reserves will reach $42.6 billion at the end of next year and $44.1 billion a year later, while in April the National Bank gave more modest estimates of $36.1 billion and $37.1 billion, respectively.
The NBU expects that this year the external financing of the state budget alone will amount to $42 bln, and next year it estimates such a need at $37 bln.
According to its forecasts, such a large-scale financial external support will fully cover the negative current account balance, which this year and next year the NBU estimates at $11 bln, $17.2 bln and $16.1 bln, respectively.
As reported earlier, due to a significant inflow of external financing, Ukraine’s international reserves rose by 4.5 percent in June to a record high of $39.00bn.
The National Bank of Ukraine (NBU) has raised the country’s international reserves forecast for the end of 2023 to $34.5 billion from $27 billion in its January forecast.
“In total, receipts from international partners may exceed $42 billion this year. Receipts from partners, in particular, will boost international reserves to more than $35 billion at the end of this year,” NBU Governor Andriy Pyshny said Thursday, presenting the updated macro forecast.
The National Bank expects reserves to reach $36.1 billion at the end of 2024, while previously it had expected $31 billion.
According to the updated forecast, the estimate of the current account deficit is improved this year to $13.5 billion from $20.4 billion, but worsened next year to $10.6 billion from $8.4 billion, while last year its surplus was $8 billion.
The NBU points out that the persistence of a significant current account deficit in 2023, in particular due to increased imports amid a gradual recovery of domestic demand, the costs of a significant number of forced Ukrainian migrants abroad and still restrained exports as a result of declining harvests and limited logistics routes. At the same time, the arrival of international aid will offset these factors, the regulator added.
“The net inflow of currency to Ukraine remains due to significant volumes of international aid. This will strengthen the NBU’s ability to further maintain exchange rate stability and gradually ease currency restrictions,” the NBU noted.
The receipt of $2.7bn of the first tranche of the International Monetary Fund’s (IMF) extended EFF loan has boosted Ukraine’s international reserves to more than $32bn, First Deputy NBU Governor Yekaterina Rozhkova has said.
“Taking into account these funds, the amount of assistance received from our partners since the beginning of the year reached $13.6 billion, and international reserves of the National Bank of Ukraine exceeded $32 billion,” she wrote on Facebook.
As it was reported, the volume of interventions of the National Bank in March decreased to $1.67 billion from $2.43 billion in February and $3.08 billion and $3.16 billion in January and December.
Due to lower currency receipts from international partners and simultaneous growth of payments on foreign currency debts, Ukraine’s international reserves in February decreased by 3.5%, or $1.064 billion to $28.865 billion, but remained above the level of the beginning of the year at $28.494 billion.
