The validity of this event shows

Where is widely used mechanism for mandatory reserve requirements, standards which tend to decrease. Another possible direction of using the mechanism of reserve requirements is to free the banks from obligatory reserve funds attracted in national currency, which are aimed at long-term lending to investment and innovation projects of national economic actors, the development of domestic production, creating an internal supply, as well as energy saving and import substitution. This practice of selective and non-market policy measure, but its provisional application may be appropriate in the acute need to address importozalezhosti caused by the lack of domestic supply, adequate growing demand of the population, as well as large energy consumption of domestic production and the influence of these factors on the deterioration of the balance of payments, inflation and exchange rate dynamics in the country. In our opinion, this measure in terms of direct limits on the increase in lending in foreign currency counterparts, who have no sources of foreign exchange earnings, to promote positive change in the loan portfolios of banks, which means - an increase in long-term investment in the real economy, reduce inflation and liquidity risk for banks. One reason that banks in Ukraine hryvnia liquidity shortage feel is their policy-oriented in terms of devaluation expectations for the accumulation and retention of convertible foreign currency. If they over-rely on their liquidity support through the NBU refinancing instruments. In this case, reasonable exercise of the NBU, in our opinion, may be a temporary cessation of swap operations (foreign exchange to maintain the hryvnia hryvnia liquidity of up to 15 calendar days), or at least set limits on the maximum amounts to operations "currency swap "and raise the cost to banks. It will force banks to abandon the policy of speculative accumulation of foreign currency and sell it on the market to maintain their own liquidity, which will increase the supply of foreign currency in the market, reducing pressure on the exchange rate dynamics and increase the hryvnia liquidity in the banking system of Ukraine. Category: Liquidity of the banking system of Ukraine | Tags: banking system liquidity