Bleyzer Foundation: Decline of gold and currency reserves not critical for Ukraine.

By bne IntelliNews August 8, 2013

The decline in Fx/gold reserves in July to USD 22.2bn is not critical for Ukraine, believes, executive director of Bleyzer Foundation Oleh Ustenko. According to the expert, gold and currency reserves contracted due to objective reasons. Mainly, payments on external public debts had an impact on the fall of reserve volumes. At the same time, he stressed that Ukraine has already paid more than half of external public debts.

In addition, the EUR rate had an impact on reduction of gold and currency reserves in the pair euro/dollar, since the reserves are counted just in dollars, the economist said. Moreover, the NBU actions on substitution of foreign currency with gold had an impact on the volume of gold and currency reserves.

The reserves of the central bank in July fell to the lowest level since January 2007. The central bank said that the reduction of its reserves was partially offset by proceeds from the sale of government securities for USD 314mn.

According to various experts, Ukraine’s international reserves, that hardly cover 3-month exports, will fall to USD 20.5bn-20.7bn by the end of the year, due to widening of the foreign trade deficit and repayment of external debts.

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