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| Source: Thomson Reuters |
Ukraine’s central bank is doing what it can to protect the hryvnia.
The currency was trading at 9.10 to the US dollar on Friday morning, back from a low of 11 to the dollar on Thursday (it opened the year at 8.20). Reuters reported that foreign exchange reserves had fallen to $15bn from $17.8bn on February 1, as the bank intervened to reduce volatility in the exchange rate.
Reuters also reported that Stepan Kubiv, appointed as central bank governor this week, told journalists on Friday the bank would limit foreign currency withdrawals from bank deposits to 15,000 hryvnia a day.
It is a stop-gap measure at best. As Kubiv said in a statement announcing his appointment on Thursday, “the resumption of talks with foreign creditors and restoration of investors’ confidence in our country are crucial.” Anders Aslund, a former advisor to the Ukrainian government, argued in the FT that the IMF could start disbursements under a new aid package as early as next month – though there are big question marks over that.
With fresh and alarming twists to the situation coming quickly, Kubiv will have his work cut out."
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