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Ukraine finance ministry wants limited cash dlr sales | 07.12

Ukraine`s finance ministry has proposed that the central bank limit the sale of foreign currencies for cash use, the ministry said on Friday, Reuters reported.

Demand for the dollar has surged as the hryvnia currency rapidly shed over 60 percent of its value since the start of September. Ukraine`s economy is highly dollarised -- many Ukrainians took out loans for cars or apartments in dollars.

And, although repayment of those debts would not be affected under the finance ministry`s proposal, many people and businesses have rushed to buy more dollars than needed to guard against further falls in the hryvnia.

"In order to regulate the exchange rate we propose introducing a post-audit of operations of how purchased currency (dollars) is used," the ministry said in a statement outlining its proposal to the central bank.

It said the sale of dollars should be allowed for paying import contracts, servicing foreign currency debt or for banks needing to pay foreign currency deposits.

"At the same time, we propose ceasing the sale of the dollar for use in cash operations," the ministry said.

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