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Ukraine's international reserves fall for third month in a row to $38.9 billion

by Dominic Culverwell November 7, 2023 8:14 PM 2 min read
The building of the National Bank of Ukraine in Kyiv. (Photo by Panama7/ Getty Images)
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Ukraine’s international reserves fell by 1.9% in October to $38.9 billion after the government repaid debts on the foreign exchange (FX) market, the National Bank of Ukraine (NBU) announced on Nov. 7.

International reserves were recorded at $39.7 billion in September and have been steadily decreasing since peaking at a record high of $41.7 billion in July 2023.

Despite the fall, volumes are still sufficient thanks to major financial injections over the spring and summer that created a solid support base. Current volumes tower over the same period last year when reserves were only at $25.3 billion in Oct. 2022.

International fiscal support remains strong, although not at the same level seen in June and July, which saw inflows of $4.3 billion and $4.7 billion, respectively.

Last month, foreign partners provided Ukraine with $3.3 billion, which was enough to offset the debt repayments. The EU supplied $1.6 billion to Ukraine, the U.S. contributed $1.2 billion, while international investors provided $572.7 million through bond placements.

The NBU added that it sold $3.4 billion on the FX market and purchased $14 million to bolster international reserves. Net FX sales totaled $3.3 billion, an increase from September’s result of $2.7 billion.

In total, the government spent $892.5 million to repay FX public debt. This included $715.3 million to service and redeem FX domestic government debt securities and $135.8 million to repay debt to the World Bank, with the remaining amount repaying other international creditors.

Additionally, the government repaid $80 million to the International Monetary Fund (IMF).

The value of financial instruments also increased by $247.2 million in October due to revaluation.

IMF launches fund for supporting Ukraine’s reforms
The international organization made the announcement during a week-long IMF-World Bank conference in Marrakech. According to Pyshnyi, donors have already allocated $14 million to the IMF’s Ukraine Capacity Development Fund, with the goal being to raise $65 million.
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