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Wednesday, March 29, 2017

Ukrainian, Chinese banks enter currency swap agreement

The National Bank of Ukraine (NBU) signed a currency swap agreement with the People's Bank of China (PBC) during a Central Bank Governors' Club of Central Asia, Black Sea Region and Balkan Countries meeting on Friday.  

"This agreement is extremely important for our countries, being strategic partners, and will promote the economic development of both countries," NBU Governor Valeriia Gontareva said. "The funds received under the agreement may be used to finance commercial operations and direct investments between the two countries." 

The agreement, signed by Gontareva and PBC Governor Zhou Xiaochuan, is equivalent to approximately $115 billion. It goes into effect on June 23, replacing an earlier agreement from 2012. 

Gontareva said the new agreement will reduce foreign currency demand from importers, which would help alleviate exchange rate pressures. It also will help with the overall stabilization of the domestic currency.