Ukraine's forex reserves 1% up in July – NBU
Ukraine's international reserves in July 2020, according to preliminary data, increased by 1%, to $28.802 billion, according to the website of the National Bank of Ukraine (NBU).
"The growth of reserves over the past month was due, first of all, to the successful placement of eurobonds by the government," the central bank said.
According to the NBU, the dynamics of reserves was influenced by foreign exchange receipts in favor of the government in July in the amount of $1.75 billion, including $1.259 billion from the placement of eurobonds and $608.2 million from the sale of government domestic loan bonds denominated in foreign currency.
It is indicated that the government allocated $1.5 billion to repay the state debt in foreign currency, including $767 million on government bonds denominated in foreign currency, and the rest of the funds on obligations to foreign creditors.
According to the report, the dynamics of reserves in July was also influenced by the NBU's operations in the interbank foreign exchange market: the regulator sold $498.7 million and bought $130 million.
"In July, the demand for foreign exchange in the interbank foreign exchange market slightly exceeded the supply, so the NBU resumed interventions to sell foreign exchange to smooth out excessive fluctuations ... At the same time, on some days, the situation in the foreign exchange market was favorable, therefore the NBU could replenish reserves at the expense of buying currency," the report says.
In addition, the dynamics of the indicator in July was influenced by the revaluation of financial instruments (changes in the market value and the exchange rate of the hryvnia against foreign currencies): last month their value increased by $406.3 million in equivalent, according to the National Bank.
The regulator noted that as of August 1, 2020, the volume of international reserves covers 4.9 months of future imports. It is clarified that this is enough to fulfill the obligations of Ukraine and the current operations of the government and the NBU.