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UPDATE 1-Ukraine c.bank changes intervention rate

Published 05/07/2009, 11:44 AM
Updated 05/07/2009, 11:48 AM

(Adds dealers, details)

KIEV, May 7 (Reuters) - Ukraine's central bank has changed its intervention rate for the first time since Feb. 20, offering to sell dollars on the interbank market on Thursday at 7.75 hryvnias, according to its data. The bank had been offering to sell dollars at 7.9 hryvnias and buy them at 7.7 hryvnias for over two months. The buy rate remains the same.

The central bank also announced on Thursday that it would close the gap between its official rate -- 7.7/$ since Dec. 28, 2008 -- and the rate on the interbank market to 2 percent.

This had been a condition for securing a $16.4 billion credit agreed with the International Monetary Fund late last year.

Dealers said the statement, and the fact that the interbank market had been relatively stable for the past two weeks with the hryvnia strengthening slightly, meant that the central bank was likely to change the official rate soon.

"Trading today ended with the dollar falling -- there were even rates of 7.93/$. There has been a trend in the past few days of the dollar being offered and the hryvnia strengthening," said one dealer.

"(The central bank) will most likely start looking tomorrow at how to react to the market and change the official rate at the start of next week."

The central bank spent $1.077 billion on intervention in March, lower than $1.73 billion in February. It spent far less on intervention in the first quarter of this year -- $4.418 billion, than in the last quarter of 2008 -- $10.284 billion. (Reporting by Yuri Kulikov; editing by Stephen Nisbet)

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