National Bank of Ukraine expects int'l reserves to fall 5% to $27 bln in 2023

MOSCOW. Jan 26 (Interfax) - The National Bank of Ukraine forecasts its international reserves will be $27 billion at the end of 2023, Ukrainian media reported, quoting an NBU press release.

The international reserves fell 7.9% in 2022 to $28.491 billion so they could decrease by another 5.2% in 2023.

"In view of the already announced international aid and progress made in negotiations with the IMF, overall official financing in 2023 could exceed $38 billion. This will enable Ukraine to refrain from the monetary financing of the budget deficit in 2023, and to maintain international reserves at a sufficient level even in the face of longer-lasting high security risks. International reserves are expected to hit about $27 billion by the end of 2023, and will continue to rise," the NBU said.

It said Ukraine received over $32 billion in international assistance, of which over $14 billion was in the form of grants, in 2022. This enabled the country to finance a larger portion of the consolidated budget deficit - over 27% of GDP, excluding grants -and to increase international reserves, to $28.5 billion by the end of the year.

Currently, reserves are sufficient to safeguard the stability of the FX market, the NBU said.

NBU Deputy Governor Yury Gelety said Ukraine's international reserves would grow to about $30 billion by the end of January. "The gold and foreign exchange reserves: we ended the year at $28.5 billion, which is $1 billion more than at the end of February. For January, we expect them to be about $30 billion. There are enough reserves," he said during a press posted on YouTube.

Gelety said there were currently no grounds for pegging the exchange rate at a new level. "Our strategic goal is to weaken it, and we will work on it," he said.

"We have enough reserves, and we are counting on rhythmic international assistance in order to make interventions," he said.