Ukraine’s gross international reserves increased by $0.59bn, or 2.1%, to $28.95bn in July, the National Bank of Ukraine (NBU) reported on August 5. The growth was prompted by receipts from the placement of international Eurobonds, coupled with the NBU’s interventions at Ukraine’s ForEx market.

In July, the foreign currency inflow to the government’s accounts amounted to $666mn (in the equivalent). In particular, receipts from the additional issue of international Eurobonds amounted to $526mn and $140mn from the placement of local Eurobonds. At the same time, total government payments on the redemption and servicing of state debt in foreign currency amounted to $417mn, of which $369mn was directed to the redemption and servicing of local Eurobonds.

The net purchase of foreign currency by the NBU at the ForEx market amounted to $188mn in July.

The NBU also reported a $157mn increase in the value of its securities portfolio. As of August 1, Ukraine’s gross reserves amounted to 4.1 months of imports, the NBU said.

“The growth of Ukraine’s international reserves in July exceeded our expectations, as an additional placement of international Eurobonds was quite a surprise. The improvement of the situation at Ukraine’s Forex in the second half of the month prompted the NBU to renew the purchase of the foreign currency. The expected payment of around $2.7bn from the IMF in the form of an SDR allocation will result in a surge of Ukraine’s gross international reserves in August. Meanwhile, the major foreign currency outlay is the repayment to the IMF of around $205mn. We expect Ukraine’s international reserves to increase 8-9% in August,” an analyst at the Kyiv-based Concorde Capital brokerage said in a research note.