Ukrainian international reserves decreased by 5.3% in February
Monday, 7 March 2022, 16:10
As of 1 March, Ukraine's international reserves amounted to $27.5 billion. In February, the reserves decreased by 5.3% - as reported by the press service of the National Bank.
In February, reserves exceeded the level at which Ukraine entered the corona crisis in early March 2020 ($27 billion).
"Decline in the international reserves is primarily due to payments on foreign liabilities of the state last month, and the interventions of the National Bank, necessary to mitigate the excessive fluctuations in the foreign exchange market," the National Bank said.
The National Bank spoke about the factors that determined the dynamics of reserves during February. In particular, they spoke of public debt management operations.
"The total amount of government payments for the servicing and repayment of public debt in foreign currency amounted to $1.4 billion. Of this amount, $781.9 million was spent on the servicing and redemption of domestic government bonds, $428.4 million for the servicing and repayment of Eurobonds, and the rest to meet other obligations of the state in foreign currency.
Foreign exchange earnings for the government amounted to $65 million, including $25 million from investments of non-residents in domestic government bonds. In addition, in February, the National Bank and the Government of Ukraine paid $199.1 million in favour of the IMF," the statement said.
Also, among the factors– National Bank operations in the interbank foreign exchange market.
"After the Russians invaded Ukraine on 24 February, the National Bank imposed restrictions on the foreign exchange market to protect Ukraine's financial system, its reliable and stable functioning.
From 24 to 28 February, due to the current restrictions, the central bank mainly bought foreign currency from banks. Prior to Russia's armed attack on Ukraine, the situation in the foreign exchange market was volatile, and the National Bank both sold and bought foreign exchange to smooth out excessive fluctuations.
In total, the National Bank sold $1.3 billion in the foreign exchange market in February and bought $901.2 million. Thus, the central bank's net sales of foreign currency from reserves last month amounted to $357.8 million," the statement said.
Also, reassessment of financial instruments (due to the changes in market value and exchange rates) is among the factors impacting the volume of reserves. Last month, their value increased by $339.7 million.
"The current volume of international reserves provides funding for 3.8 months of current imports, which is sufficient to meet Ukraine's obligations and current operations of the government and the National Bank," the NBU added.
Reminder: Ukraine's international reserves fell by 5% to $29.3 billion in January.
Economichna Pravda
