Hryvnia Weakens to Near Record as Ukraine Says Russia Invading

Ukraine currency: hryvnia

The hryvnia extended its fifth weekly depreciation and Ukrainian bonds fell as the government said Russia is invading the country under the cover of aid.
The currency slumped 2.5 percent to 13.55 per dollar by 4:43 p.m. in Kiev, within 0.17 hryvnia of a record low reached on Aug. 12. It lost 9.4 percent this month, the most among all currencies tracked by Bloomberg, and is down 39 percent in 2014.
Russian trucks with aid for eastern Ukraine crossed the border without consent from the government in Kiev, representing a “direct invasion,” Valentyn Nalyvaychenko, the head of Ukraine’s security council, said on TV5. More than 150 trucks entered without a Red Cross escort through a border checkpoint in a rebel-held area and headed for the city of Luhansk. Russia warned against attempts to disrupt the convoy.
“This would suggest ‘escalation’ and a red line would appear to have been crossed,” Timothy Ash, an economist for emerging markets at Standard Bank Group Ltd. in London, said by e-mail today. While Ukraine said it won’t attack the trucks, “this is still a high risk operation, with a not insignificant chance that trucks suffer damage,” he said.
The yield on the sovereign dollar-denominated debt maturing in July 2017 rose 22 basis points, or 0.22 percentage point, to a one-week high of 10.21 percent, according to data compiled by Bloomberg.
To contact the reporter on this story: Krystof Chamonikolas in Prague atkchamonikola@bloomberg.net
To contact the editors responsible for this story: Wojciech Moskwa at wmoskwa@bloomberg.netZahra Hankir



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