Money supply in Ukraine in June 2018 rose 1 percent to 1 trillion 209,84 billion UAH, these preliminary data on monetary statistics the national Bank of Ukraine (NBU) announced on its website on Tuesday.
According to them, the monetary base has increased over the past month from 3.1% to 419,95 billion.
Such dynamics of monetary aggregates is due primarily to the increase in the volume of cash in circulation outside banks — by 3.6% to 345 billion, while the balance of deposits increased by only 0,2% — to 864,42 billion.
Since the beginning of 2018, the monetary base grew by 5.2%, whereas money supply is only 0.1%.
The NBU clarifies that the balances of hryvnia deposits in solvent banks in June increased by 5.9% to 262,9 billion UAH, in foreign currency (in dollar equivalent) — by 1.1%, to $8.5 billion, According to the regulator, active attraction of funds of individuals has contributed to high wage growth and further growth of private transfers from abroad. In addition, the inflow of funds on the hryvnia deposits was caused by the persistence of a significant difference in yield currency deposits against the background of virtually unchanged exchange rate of the national currency to the U.S. dollar, according to the national Bank.
At the same time, balances of deposits of legal entities in solvent banks in the past month decreased by: deposits by 5.6%, to 243,8 billion UAH, in foreign currency (in dollar equivalent) — by 1.3%, to $5.1 billion, the NBU explains the dynamics of such a deduction to public companies to the budget.
Thus, the total portfolio of deposits in national currency in June has not changed and remained at the level 506,7 billion UAH, says the regulator.
It indicates that the credit portfolio of banks in national currency in June declined by 1.4% to 584,9 billion UAH due to reduction of loans to businesses by 1.8% to 468,2 billion, while the portfolio of loans to natural persons remained almost at the previous month – 116,7 billion UAH.
NBU notes that the preservation of competition among banks for corporate customers led to a slight increase in interest rates on business deposits in the national currency — by 0.2 percentage points (PP) to 11.6% per annum. The cost of hryvnia loans to legal entities grew by 0.1 percentage points to 17.1% per annum, reflecting the increase in credit demand, particularly on the reverse of objectives of enterprises, according to the national Bank.
According to him, the cost of hryvnia deposits remained virtually at the level of the previous month (10.8% APR), given a steady inflow of population. But rates on loans to individuals increased by 0.6% to 31.8% per annum, which the NBU communicates with higher lending standards by major banks on loans of more than one year. At the same time this was offset by the decrease in the cost of short-term loans.
According to Central Bank statistics, interest rates on foreign currency loans to households in June fell by 2.5 percentage points to 5.7% per annum, whereas on foreign currency deposits, they increased by 0.1 percentage points to 2.3% per annum.