OREANDA-NEWS. Mr Oleksandr Arseniuk, Deputy Director of General Monetary Policy Department, said that the National Bank of Ukraine had purchased USD 215 million in the interbank foreign exchange market. According to him, the foreign exchange market has recently shown signs of improvement. In particular, the net demand for foreign exchange recorded in the first quarter of 2014 has reversed to the net supply in April-May, which was recorded both in the cashless (USD 0.2 billion) and cash (USD 0.3 billion) segments of the foreign exchange market.

“Smoothing sharp swings in the hryvnia exchange rate is viewed as its task by the National Bank of Ukraine. In addition, given the need to replenish the country's international reserves, on May 30, 2014, the central bank adopted a decision to intervene in the interbank foreign exchange market by purchasing foreign exchange,” he noted.

Mr Oleksandr Arseniuk believes that these developments point to a gradual improvement in market expectations. This is facilitated by a large-scale stabilization program supported by an IMF's Stand-By Arrangement, which allows Ukraine to borrow funds from creditors on the domestic and international capital markets.

He also emphasized that under such conditions there was a growing demand for national currency from economic entities that were inclined to sell foreign currency accumulated during the period of uncertainty. These trends are especially evident during a period when economic entities pay taxes and other duties (mandatory payments) to the budget, which, in particular, was seen in the last days of May.