currencies

Ukraine limits cash withdrawals, bans forex purchases as Russia invades

Reuters
Ukraine limits cash withdrawals, bans forex purchases as Russia invades

CURRENCY. Ukrainian hryvnia banknotes are seen in a photo illustration shot in Kiev, Ukraine, August 6, 2014.

Konstantin Chernichkin/Reuters

Ukraine's central bank limits daily withdrawals in the local currency to 100,000 hryvnias ($3,356.67). It also bans cross-border forex transactions and cash forex withdrawals.

KYIV, Ukraine – Ukraine’s central bank suspended foreign exchange cash withdrawals and limited how much local currency people could take out of automated teller machines on Thursday, February 24, as Russia’s invasion sent assets tumbling.

The measures came as people queued up to try and get money, water, and food in Kyiv and other cities in the wake of Russia’s all-out attack on Ukraine by land, air, and sea, the biggest assault by one state on another in Europe since World War II.

Some Ukraine sovereign dollar bonds fell more than 30 cents in the dollar, with many trading below 40 cents while the central bank said it had fixed the official hryvnia exchange rate.

The hryvnia, which has suffered almost double-digit falls since the start of the year, slipped nearly 3% on Wednesday, February 23, to trade at 29.79 versus the dollar, its weakest since early 2015.

Assets across other ex-Soviet countries, from Belarus to Ukraine and Russia itself, suffered major sell-offs.

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In a move to preserve stability of the banking sector, the central bank also banned cross-border forex transactions and cash forex withdrawals, and suspended forex purchases on the interbank market while keeping non-hryvnia sales untouched.

Governor Kyrylo Shevchenko said the bank had limited daily withdrawals in the local currency to 100,000 hryvnias ($3,356.67) and suspended the topping up of electronic wallets.

The central bank said that other non-cash transactions were not limited and banks could get up to one-year refinancing loans without any limit on the amount.

Trading in all securities, excluding by the central bank and the finance ministry, were also temporary suspended, the state stock market regulator said separately, in a move to prevent further volatility in assets. – Rappler.com

$1 = 29.7914 hryvnias

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