Ukraine’s international reserves have reached a record level not seen in eleven years. According to the National Bank of Ukraine, the country’s reserves rose to $29.3 billion at the end of March 2023, which is the highest level since December 2011.
This increase in reserves is seen as a positive sign for Ukraine’s economy, which has been struggling in recent years due to political instability and conflict in the eastern region. The rise in reserves has been attributed to a number of factors, including strong exports and remittances, as well as increased foreign investment in the country.
The National Bank of Ukraine has also been taking steps to improve the country’s financial stability, including implementing macroeconomic policies aimed at reducing inflation and stabilizing the currency. These efforts have helped to boost investor confidence and attract foreign investment, which has contributed to the rise in reserves.
The increase in reserves is also significant because it provides a cushion against external shocks and helps to ensure the country’s ability to meet its financial obligations. With a higher level of reserves, Ukraine is better positioned to weather any economic downturns or financial crises that may arise in the future.
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Despite the positive news, there are still challenges facing Ukraine’s economy, including high levels of corruption and ongoing conflict in the eastern region. However, the increase in reserves is a promising sign that the country is moving in the right direction and taking steps to improve its economic stability.
This contributes to the stabilization of the hryvnia.
International reserves of Ukraine as of April 1 amounted to 31,878.2 million dollars. USA, which is a record for the last 11 years. As noted in the National Bank of Ukraine, in March, reserves rose by 10% at once due to receipts from international partners against the backdrop of lower net foreign currency sales and moderate debt repayments of the country in foreign currency.
On the whole, several factors influenced the growth dynamics of international reserves in March. Firstly, this is a receipt in favor of the government and payments for servicing and repaying the public debt. In particular, $5,105.4 million was received from the government’s foreign currency accounts with the National Bank. The USA.
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From this amount:
- $1,756.6 million USA – from the Government of Canada;
- $1,617.1 million USA – from the EU;
- $1,253.1 million United States – from the United States (through the World Bank Trust Fund);
- $2.2 million USA – from the International Development Association (IDA), which is part of the World Bank;
- $476.5 million USA – from the placement of foreign currency bonds of domestic government loans (OVGZ).
Ukraine also paid 486.8 million dollars for servicing and repayment of the state debt in foreign currency. United States to various foreign creditors and paid an additional $638.6 million to the International Monetary Fund The USA.
Secondly, in March 2023, the NBU sold $1,674.1 million on the foreign exchange market. USA and bought into reserves – 5.2 million dollars. The USA. Thus, the net sale of foreign currency by the NBU last month decreased by $783.1 million compared to February in The USA. The decline in NBU currency sales has been observed for the third month in a row.
Thirdly, there was a revaluation of financial instruments as a result of changes in market value and exchange rates.
The NBU notes that the current volume of international reserves provides financing for 4.2 months of future imports.
According to the forecast of financial experts, the dollar exchange rate in Ukraine in April may fall from UAH 38.3 to UAH 36.93. The main prerequisite is a stable situation at the front and financial support from Western partners.
