August 20, 2014 / 5:40 PM / 5 years ago

UPDATE 1-Ukraine central bank: companies must sell all foreign currency earnings in domestic market

(Amends editing credit; story text unchanged)

KIEV, Aug 20 (Reuters) - Ukraine’s central bank said on Wednesday companies must sell all of their foreign currency income on the domestic market, up from the previous 50 percent, to offset the pressure of a pro-Russian separatist revolt on the Ukrainian currency.

Last week central bank head Valeria Hontareva said a mood of panic was weighing on the hryvnia, which is trading close to an all-time low of 13.70, first reached in mid-April when rebels in the Russian-speaking east declared “people’s republics”, saying they wanted union with Russia.

The decision to tighten mandatory foreign currency sales was taken “given the economic problems linked to the anti-terrorist operation in Ukraine ... and to regulate the situation on the foreign exchange market”, the bank said in a statement.

The new rule will remain in force until Nov. 21. However, the central bank has extended similar regulations in the past.

Banks will have to sell foreign currency earnings the day after receiving the funds from companies, the central bank said. (Reporting by Natalia Zinets; Writing by Alessandra Prentice; Editing by Mark Heinrich)

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