Ukraine’s international reserves in October rose to 18.1 billion dollars

Ukraine’s international reserves in October 2018 rose by 0.6% and as of 1 November totaled $16,737 billion, corresponding to preliminary data published on the website of the National Bank of Ukraine (NBU).

Международные резервы Украины в октябре выросли до 18,1 млрд долларов‍

However, the Central Bank said that the data at the beginning of November does not take into account the recent placement of Eurobonds Ukraine.

“Thanks to the receipt of funds from this placement, as of November 5, Ukraine’s international reserves rose to $18,069 billion, which corresponds to three months of future imports”, — stated in the message.

Regarding the change in reserves in October, the national Bank indicates that their level is affected, including foreign exchange intervention of the Central Bank. The NBU, in particular, joined the reserves due to net purchases of foreign currency on the interbank currency market that was made possible due to the absence of devaluation pressure on the hryvnia, and the availability of excess supply of foreign currency, including at the expense of foreign exchange proceeds from exports of the grain harvest.

In General, the NBU for the month purchased in the market of $268.5 million, including $126 million through a selection of the best prices of functional matching and $142.4 million at a uniform rate, and sold $70 million, all at a uniform rate. Thus, the net purchase of foreign currency in October was $198,5 million

In addition, the level of reserves was affected by the operation of the government. According to the NBU, the amount of payments on servicing and repayment of public and publicly guaranteed debt in foreign currency in October was $853 million (equivalent), including $777,8 mln on bonds of domestic government loan (government bonds). However, these costs were almost entirely offset with revenue from the placement of government bonds in the amount of $790,7 million (equivalent).

The third factor was made by the revaluation of financial instruments (change in market value and exchange rate of hryvnia to foreign currencies), whereby the value of the reserves last month fell by $36.8 million (equivalent).

The NBU clarifies that the volume of international reserves as of November 1, 2018 cover of 2.8 months of future imports is sufficient to meet the obligations and current operations of the government and the National Bank.

As reported, Ukraine in late October, placed two issues of Eurobonds: five-year $750 million with a yield of 8.99% per annum and a 10-year $1.25 billion with a yield of 9.75% per annum.

The organizers of issue of Eurobonds made by BNP Paribas, Citi, Goldman Sachs and J. P. Morgan.

In September last year, Ukraine has placed a 15-year Eurobonds for $3 billion with a yield to maturity of 7.375%. The organizers were BNP Paribas, Goldman Sachs and JP Morgan. Simultaneously with the placement of the new issue of the Finance Ministry of Ukraine has redeemed Eurobonds with maturity in 2019 and 2020 for a total of $1,576 billion.

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