Ukraine’s international reserves as of 1 August 2021 stood at an equivalent of $28.951 billion, which is 2.1% more than as of early July 2021 ($27.358 billion), according to data from the National Bank of Ukraine (NBU) published on Thursday.
“As of 1 August 2021, Ukraine’’s international reserves stood at an equivalent of $28,951.1 million, according to preliminary data. In July, international reserves increased by 2.1%, primarily due to the government’s placement of eurobonds and purchases by the National Bank of Ukraine (NBU) of foreign currency on the interbank FX market,” the NBU said.
The central bank said that international reserves in July were affected by the following factors: first, transactions related to public debt management. The government spent $416.9 million (in the equivalent) on servicing and repayment of public debt denominated in foreign currency, including $368.9 million in repayments on domestic government debt securities, while the rest of the funds went to meet the government’s other FX commitments.
FX inflows to the government amounted to $665.8 million (in the equivalent), of which $525.8 million (in the equivalent) came from a placement of eurobonds, and $140 million (in the equivalent) from domestic government debt securities.
Second, the NBU’s transactions in the FX interbank market also affected international reserves in July. During the first weeks of July, the interbank FX market was mostly balanced. On some days, however, mainly in the second half of the month, market supply exceeded demand, in part due to a pick-up in FX sales by a number of private and state-owned companies. This enabled the NBU to add $188 million to international reserves.
Third, the revaluation of financial instruments (due to changes in their market value and exchange rate fluctuations) affected international reserves. Last month, the value of these instruments increased by $156.5 million (in the equivalent).
International reserves now cover 4.1 months of future imports, sufficient for Ukraine to meet its commitments, and for the government and the NBU to make their current transactions.
In addition, the NBU said that Ukraine’s net international reserves (NIR) in June increased by $551 million, or 3.1%, to $18.528 billion.
