Ukraine’s International Reserves Decrease: What Caused the Decline and Are There Risks for the FX Market
8 August 2025 01:25
As of August 1, 2025, Ukraine’s international reserves amounted to $43.03 billion. According to preliminary estimates of the NBU, in July the volume of reserves decreased by 4.5%, or $2 billion. This was reported by "Komersant Ukrainian" with reference to the NBU.
This dynamics was driven by the NBU’s foreign exchange interventions and the country’s debt payments in foreign currency. These operations were only partially offset by proceeds from international partners and from the placement of foreign currency domestic government bonds (foreign currency government bonds). Despite the decrease, the amount of international reserves is sufficient to maintain the stability of the foreign exchange market.
Main factors behind changes in Ukraine’s international reserves
Overall, the dynamics of reserves was determined by a number of factors.
Foreign exchange interventions by the NBU
In July, the National Bank of Ukraine actively intervened to support the hryvnia exchange rate:
- Sale of foreign currency: $3,457.3 million
- Purchase of foreign currency: only $0.3 million
- Net sale of foreign currency: $3,457.0 million
These actions were aimed at smoothing out currency market fluctuations and preventing excessive pressure on the hryvnia.
Receipts in foreign currency
Second, revenues in favor of the government and payments for servicing and repayment of public debt
In July, the government’s foreign currency accounts at the NBU received USD 2,122.1 million. In July, the government received USD 2,122.1 million in foreign currency, including:
- uSD 1,171.0 million. USD 1,171.0 million was received from the European Union under the G7 Extraordinary Revenue Acceleration for Ukraine (ERA) initiative;
- 513.2 million US dollars. USD 1,171.0 million from the IMF under the Extended Fund Facility (EFF) program;
- uSD 414.0 million. USD 1,914.0 million – from the placement of domestic government bonds;
- uSD 23.9 million. USD 23.9 million – through the World Bank accounts.
Public debt payments
The NBU paid USD 793.0 million to service and repay the public debt in foreign currency. The total amount of payments was USD 793.0 million, including:
- uSD 638.5 million. USD 638.0 million – servicing and repayment of domestic government bonds;
- uSD 85.1 million – servicing of domestic government bonds. USD 85.1 million – servicing of government bonds;
- uSD 61.2 million. USD 61 million – debt service and repayment to the World Bank;
- uSD 7.1 million – debt service to the World Bank USD 7 million – debt service to the EU;
- uSD 1.1 million – debt service to the EU; and USD 1.1 million – payment to other creditors.
In addition, Ukraine paid USD 2.6 million to the International Monetary Fund. IN ADDITION, UKRAINE PAID USD 2.6 MILLION TO THE INTERNATIONAL MONETARY FUND.
Revaluation of financial instruments
Third, revaluation of financial instruments (due to changes in market values and exchange rates)
In July, the revaluation of financial instruments increased the value of financial instruments by USD 101.5 million. THE NBU’S RESERVES INCREASED BY USD 101.5 MILLION.
How much will the reserves be enough?
As of the end of July, Ukraine’s current international reserves cover 4.7 months of imports, which is above the critical level and allows the NBU to respond flexibly to foreign exchange market challenges.
When is the reserve data updated?
The National Bank of Ukraine publishes the data on a regular basis:
- Preliminary data – no later than the 7th day of the month;
- Revised data – by the 21st day of the month.
These reports allow analysts and the market to track the dynamics of reserves and the effectiveness of macrofinancial policy.
