Picked this up from FT, the Ukrainian economy shrank by 25-30% on year in the first two months of 2009. This announcement from the president comes even as the prime minister last week promised that the hryvnia would strengthen. The grim news is also one reason why
The central bank’s currency regulation department told lenders on March 17 that chairmen would be held responsible for the hryvnia exchange rates quoted on their bank Web sites and on information systems such as Bloomberg and Reuters, according to Natsionalnyi Bank Ukrainy’s head of external relations, Serhiy Kruhlik.
The central bank also suspended interbank trade agreements with Ukrainian lenders Partner-Bank, Sigmabank and Premium for disrupting the exchange rate, Delo newspaper reported today, citing a letter from the Natsionalnyi Bank. Partner Bank’s press secretary Olga Sandler in Kiev denied the allegations, saying “we think it’s a mistake.”
Ukraine needs more “administrative measures” to regulate the currency and may force companies to sell foreign-currency earnings, Petro Poroshenko, head of the central bank’s council, said in remarks broadcast on the country’s channel 5 today. “Most experts agree that liberalization of currency regulation should stop,” he said.
Ukraine’s central bank has taken control of 11 local lenders since requesting the IMF loan. The Washington-based fund estimates the country will need to spend about 4.5 percent of its GDP to recapitalize the banking sector.
The yield on 4.95 percent euro-denominated Ukraine government bonds due 2015 doubled to 24 percent in the past six months. Russian dollar-bonds due 2018 yield just 6.61 percent.
Credit-default swaps insuring Ukrainian government debt are the most expensive in emerging Europe, according to prices from CMA Datavision in London. They cost 60.5 percent of the amount covered upfront and 5 percent a year. That means investors must pay $6.1 million in advance and $500,000 a year to protect $10 million in bonds for five years. Six months ago, that same protection cost $567,000 a year and nothing upfront.
Posts
0 comments:
Post a Comment