The value of the Ukrainian hryvynia plummeted yesterday after the Ukrainian central bank decided to raise interest rates and take steps towards adopting a free floating currency, losing nearly 30% of its value. The decision to abandon currency saving measures such as auctions of foreign currency has been widely criticized by the Ukrainian populace, though the move is perceived to be in accordance with demands made by the International Monetary Fund, which is poised to extend additional loans to Ukraine.
The Ukrainian national bank recently announced that the country’s reserves of both foreign currency and gold stand at 10 year lows, standing at a meager $6.4 billion USD, enough to cover only “five weeks of imports.” Ukrainian President Petro Poroshenko has made attempts at allaying fears regarding the currency situation by affiriming that bailout agreements have in fact been signed, but such attempts to assuage critics have been largely unsuccessful due to the paucity of detail provided by the president. Due to renewed violence in eastern Ukraine and the breakdown of a cease fire, the viability of a bailout plan has been placed into question.
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- Russian Prime Minister Dmitry Medvedev has proposed that Russia and Belarus hold a joint session of the Council of Ministers of both Belarus and Russia during the first half of 2015. Medvedev is currently meeting with Belarusian Prime minister Andrei Kobyakov in Moscow, using the occasion to stress the importance of bilateral relations to the Kremlin. Other aspects, such as European integration, are expected to be discussed at forthcoming meetings.
- In what marks a sudden change in rhetoric, Iranian President Hassan Rouhani lashed out at Western nations for what he characterized as “false and hypocritical” admonitions concerning Iran’s designs for its nuclear program. Rouhani reiterated that his country does not seek nuclear weapons, and that the nuclear program it seeks is to be used for civilian purposes alone.
- Russia’s top oil producer Rosneft announced that it is planning its 2015 budget based on the assumption that oil prices will reach $50/barrel. Igor Sechin, the CEO of Rosneft stated that he considers this estimate to be “conservative” but that it gives them confidence that they will be able to confidently carry out their “investment program.” Rosneft’s oil production grew by 4.6% in 2014.
- Standard & Poor’s has refrained from lowering the ratings of Russian energy giant Lukoil and potash producer Uralkali. The possibility of the two companies receiving a lower rating has risen of late as the Ukrainian economy has recessed sharply and with the recent reduction of its debt to junk ratings. S&P credits both companies’ considerable export revenues and “flexibility” with relation to capital expenditures.
- A joint operation carried out by the Afghan National Police, the Afghan National Army and the National Directorate of Security during the last 24 hours resulted in the death of 52 militants. The operations covered ground in Kabul, Khost, Kandahar and Helmand, among other provinces.
- Tajikistan’s state-run aluminum company TALCO will up its production of aluminum from 110,000 tons in 2014 to nearly 190,000 in 2015. Tajikistan had previously estimated output of roughly 150,000 tons in 2014 but was unable to meet expectations due to a fall in global aluminum prices. In 2015 TALCO will receive assistance from Norwegian aluminum producer Hydro in both extraction and marketing of the metal. TALCO currently represents 46% of Tajikistan’s total GDP and 90% of its foreign exchange reserves.