Ukrainian money supply growth accelerated to 23% in 2023 - NBU

MOSCOW. Jan 12 (Interfax) - Ukraine's M3 money supply rose 23% or UAH 575.4 billion in 2023 to UAH 3.077 trillion rubles after growing 21% in 2022 and 12% in 2021, Ukrainian media quoted the National Bank of Ukraine as saying in a statement.

Deposits grew 28.6% or by UAH 525.6 billion to UAH 2.36 trillion in 2023 after rising 23.6% in 2022. Local currency deposits rose 35.2% or UAH 424.4 billion to UAH 1.629 trillion and foreign currency deposits grew 16.1% or the equivalent UAH 101.1 billion to the equivalent of UAH 731.3 billion as the official dollar rate strengthened 3.9%.

The monetary base rose 23.3% or UAH 184.4 billion to UAH 976.9 billion in 2023 after growing 19.6% in 2022 and 11.2% in 2021.

Cash outside banks - the M0 aggregate - rose 7.5% or UAH 50.2 billion to UAH 716.3 billion after growing 14.6% in 2022.

Reserve money at banks more than doubled in 2023, rising by UAH 134.2 billion to UAH 260.7 billion, although cash in tills decreased slightly, from UAH 49 billion to UAH 48.1 billion. Required reserves, half of which the National Bank allowed to be formed with benchmark government bonds, increased 4.8-fold to UAH 334.1 billion.

Banks also increased investments in certificates of deposit by 35.9% or UAH 164.2 billion to a record UAH 621.7 billion.

Loans, which fell 3.8% or UAH 39.1 billion in 2022, decreased by just 0.8% or UAH 7.7 billion in 2022 to UAH 982 billion, with hryvnia loans up 0.7% or UAH 5 billion to UAH 729 billion and FX loans down 4.8% or UAH 12.7 billion to UAH 253 billion.

Money supply grew 7.69% and the monetary base 5.7% in December 2023, compared with growth of 5.5% and 4.5% in December 2022.

The NBU said at the end of October that it expected money supply to grow 22.9% and the monetary base 23% in 2023 with growth slowing to 16.2% and 13%, respectively, in 2024.

The International Monetary Fund said in an updated memorandum that money supply might grow 18.2% and the monetary base 17.7% in 2024.