By KYIV. May 4 (Interfax-Ukraine) – Preliminary data showed that, as of 1 May 2023, Ukraine’s international reserves stood at $35.943 million. This is the highest level in the past 11 years (last time the reserves exceeded this level in August 2011), the National Bank of Ukraine (NBU) has reported.
“In April 2023, international reserves increased by 13% due to inflows from international partners amid further decreasing net FX sales by the NBU and moderate FX debt repayments by the state,” the central bank said.
The NBU said that a total of $5.852 billion was received to the government’s FX accounts with the NBU in April, including $2.707 billion from the IMF under the new Extended Fund Facility Arrangement; $1.653 billion of macro-financial assistance from the EU; $1.25 billion from the United States (through the World Bank’s trust fund) and $0.243 billion from the placement of FX domestic government debt securities.
According to Interfax-Ukraine estimates, the flow of foreign aid in April was the largest since the beginning of the war.
The government of Ukraine also spent $446.0 million to service and repay FX public debt. That included $282.7 million in repayments on FX domestic government debt securities and $113.1 million to repay the debt to the World Bank. The rest went towards meeting the country’s liabilities to other international creditors. In addition, Ukraine paid $107.4 million to the International Monetary Fund.
The NBU added that its interventions to sell foreign currency in Ukraine’s FX market have declined in volume for the fourth month in a row, having decreased by $0.299 billion compared to March, to $1.370 billion.
“This trend in April was driven by both sectoral factors (lower energy imports, increased sales of foreign currency for the sowing campaign, and some uptake of metals-and-mining companies) and further restrictions on unproductive capital outflows from Ukraine,” the regulator said.
Besides, the exchange rate expectations stabilized thanks to the NBU’s consistent monetary policy, through which the central bank aimed to make hryvnia assets more attractive, and by the regulator’s refusal to directly finance the budget deficit in 2023.
In addition, due to changes in their market value and exchange rate fluctuations, the value of financial instruments increased by $128.7 million in April due to revaluation.
International reserves are now covering 4.7 months of future imports, the National Bank said.
As reported, at the end of April, the NBU raised the forecast of the country’s international reserves at the end of 2023 to $34.5 billion from $27 billion in the January forecast.
