Ukraine's FX reserves as of October 1, 2020, according to preliminary data, amounted to $26.526 billion (in equivalent), which is 8.7%, or $2.523 billion less than at the beginning of September, the National Bank of Ukraine (NBU) said on Wednesday.

The central bank said that the main reasons for the significant decrease in reserves were payments for servicing and repaying state and state-guaranteed debt in foreign currency for the amount of $2.665 billion, as well as the NBU's intervention in support of the hryvnia totaling $231.5 billion.

According to the report, $2.212 billion were spent on servicing and redemption of eurobonds, $417.4 million on fulfilling obligations to the IMF, but at the same time foreign exchange receipts in favor of the government amounted to $445.0 million, including $111.9 million from the placement of government bonds.

Regarding the interventions, the National Bank said that in September the demand for foreign currency exceeded supply due to the revival of business activity, in particular, the more active importers and companies bought foreign currency to pay off foreign debts.

The central bank said that another reason for the reduction in reserves was the revaluation of financial instruments (due to changes in market value and exchange rates) by $105.7 million.

"The current volume of FX reserves covers 4.3 months of Current External Payments (CXP), which is sufficient to fulfill the obligations of Ukraine and the current operations of the government and the National Bank," the regulator said.

The NBU said that Ukraine's net FX reserves in September fell by $2.017 billion, or 11.3%, to $15.796 billion.