Government wants to obtain from the IMF permission to print money for more. Without it and without the regular portion of the loan, the Cabinet will not be able to fulfill their social obligations.

Negotiations with the mission of the International Monetary Fund of Ukraine, the third tranche of credit stand-by at 3.2 billion dollars dalis government is not easy. Last Wednesday, the Cabinet approved a letter of intent to the IMF, and after the meeting Yulia Tymoshenko accused the president that it complicates the negotiation process.

letter of intent - this is an important document, which was developed a few weeks. He will bring to the financial turnover of the Ukrainian currency the funds necessary for the stability of UAH, - explained the Prime Minister. And stressed that, in such side-letters to the borrower is trying to assume a minimum commitment, and the President only added them because of what the negotiations are protracted. In a Presidential Secretariat statement Tymoshenko told her nervousness on the background of complex negotiations.

tranche conditionalities

The IMF is concerned about the question whether Ukraine is capable to fulfill their obligations. Mission Fund does not fully understand the situation in Parliament over benefits. rollick idea of the Party of Regions has to raise the living wage just scares the IMF. It is not him and the situation in the gas market, the financial condition NAK Naftogaz Ukraine, - explained the director of the Institute for Economic Research and Policy Consulting, Igor Burakhovskiy.

Another claim IMF to Ukraine - the desire to preserve trinadtsatiprotsentnuyu allowance for duties on imports of goods uncritical. Last Wednesday, a parliamentary committee on taxation and customs policies Sergei Terekhin approved a bill on the extension of the allowance until September this year, despite the indignation of our country's trading partners.

But even in such circumstances fund is ready to go for significant concessions to us: the text of another agreement between the IMF and Ukraine may be unprecedented. Home assignment - the fund has agreed to the request of the Cabinet directly finance the Ukrainian budget deficit. The first tranche of credit stand-by in October 2008 has been enlisted in the reserves of National Bank to maintain the balance of payments, while the second tranche of more than half the funds were sent to the budget. Also, according to Tymoshenko, would be divided and the third portion of the loan. It will help the Government to maintain public debt, which will indirectly support the fund's balance of payments in Ukraine.

mission, in turn, insists that Naftogaz does not involve credit for pumping gas if current fuel prices for the population and teplokommunenergo. In the list of its requirements - higher prices for utilities and reducing subsidies teplokommunenergo. The Fund does not want at the expense of its loan Ukraine NJSC saved, but opposes a formal bankruptcy stuck in debt the company. This complicated the negotiations, because the Prime Minister is not interested in the speedy restructuring of Naftogaz and raising fares. Even if the government reform the NAC, it will remain unprofitable. And the IMF is concerned not so much to reform the company, but bringing the tariffs to economic levels. The mission insists on double or triple the price increase for natural gas for the people - said expert people's deputy of BYUT member of the Interim Commission of Inquiry on the handling of the operation of the transmission system of Ukraine and the gas consumers in 2008-2009, Sergei Pashinsky. According to him, the Government believes that the need to raise rates gradually, following the introduction of subsidizing low-income families.

Meanwhile, the IMF has refused to withdraw its condition on the limitation of funding NAK Naftogaz Ukraine from the budget. If this mission on his own reorganization NACA will only important reforms under dictation fund - other reforms envisaged in the previous memorandum, have not been realized.

Government and the IMF agreed to the revision of macroeconomic projections. Cabinet, in his letter had promised to keep inflation within 13% (previously in the memorandum was about 16% on the basis of 2009-th). A fund experts predict that this year, consumer prices in Ukraine will grow by 18%. In addition, the government insists on the extension of the budget deficit to five per cent of GDP. In this regard, may increase the amount of cash and permissible emissions. Budget issues - a key to Yulia Tymoshenko, is constantly trying to convince the public that the state treasury is filled with a small surplus.

Budget revelation

In fact, the first half for a system of public finance has been very difficult. Finger's breadth reduced contrive only through a denial of the majority of investment costs. Part of protected items costs (financing Euro-2012, emergency repairs of pipes, etc. - only about 60% of budgeted expenditure), Ministry of Finance simply moved to the second half.

with incomes all the opposite: that it was possible to draw, the government collected in January-June. During the first five months of 2009 to the general fund the state budget was 62.47 billion hryvnia, which is13.6% (or 8.533 billion hryvnia) lower than in January-May 2008. Given the almost pyatnadtsatiprotsentnoy annual inflation can be observed: the real income declined by more than a quarter. Last month, the situation has worsened - by 25 June in the treasury has collected about five billion hryvnia, and the State Tax Administration has shown a negative balance of income (the application for the VAT refund excess tax collection).

Almost all budget expenditures, net of costs of care NAK Naftogaz Ukraine and the recapitalization of banks, in the first half of this year were directed to social purposes, the payment of salaries and utilities. All investment programs and capital costs, except for Euro-2012, frozen. Such costs, as the increase in capital state bank and NAK Naftogaz Ukraine , nationalizations of problem banks, financed by bond issues of internal state loan, that is, in fact, due to the printing press NBU.

Finance Specialists predict that in August, the Government will not be able to secure finance expenditure budget in full, if you do not receive the next tranche of credit from the IMF. On the other hand, sequestration budget before the presidential election is akin to the recognition of insolvency manager. Yulia Tymoshenko caught - they can not agree with the Fund and to raise the price of gas, and at the same time, it can not enforce the budget without the money the IMF or any other external creditors. Click to continue »

World stock markets

As can be seen from published yesterday by the American Ministry of Finance data, U.S. budget deficit for June was 94.3 billion dollars after the U.S. $ 189.7 billion a month earlier. The June figure was also better than market expectations that were, on average, 97 billion dollars in the same time the beginning of the financial year, the accumulated budget deficit has already exceeded a record $ 1 trillion. U.S. Administration predicts that by the end of the fiscal year, the excess of expenditure over income of the country could be as high as 1.84 trillion. U.S.

Start a new trading week on the U.S. stock market was marked by the rise of the major indices. In the best performing stocks were financial companies, which have helped to support the corporate news and recommendations for improvements to a number of papers by eminent American experts. Financial sector subindex Standart Poor's 500 rose on Monday to 6.5%.

Dow Jones Industrial Average recorded yesterday in the growth of 2,27%, reaching values of 8331.68 point, Standart Poor's 500 added 2.49% - up to 901.05 point, Nasdaq Composite rose 2.12% and stood at mark of 1793.21 points.

Playground Asia-Pacific trading on Tuesday morning in the positive area, podrastaya more than 2%. Chinese stock market supported by strong corporate withdrawn prior reports Haitong Securities Co., Shanxi Guoyang New Energy Co. In Singapore the morning of Tuesday the government has increased the economic outlook: it is estimated that the fall of the country's GDP by the end of the year amount to 4-6% rather than 9%, as expected. Also, the economic forecast is expected from central Japan, a two-day meeting which starts today.

futures on major U.S. stock indices as of Tuesday morning in the green.

Metals Market

On Monday, July 13, metals traded on the LME, have demonstrated mixed dynamics. In the black correction after several days of continuous fall day completed the tin and nickel, went up by 2.5% and 1.7% respectively. The stock of each of them declined by 0.3%.

demand enjoyed yesterday and copper, the value of which against a background of general growth of optimism among investors had grown up to 0,8% - to $ 4 895 per tonne.

The remaining metals are joined to recovery today. Yesterday, aluminum, lead and zincis cheaper at 0.7%, 2.6% and 3.5% respectively. On Tuesday morning expensive metals together at 1-3%.

oil market

The last trading session did not reveal a clear trend of quotations of hydrocarbons, both brands under the influence of competing factors recorded on the day of multidirectional changes.

August neftefyuchers class in the price of Brent increased by 0,3%, reaching a mark of $ 60.69 per barrel, the contract mark WTI, on the contrary, had dropped in price by 0,3% and stopped at the value of 59.69 dollars per barrel .

morning on Tuesday the market value of black gold rises, both the contract adds approximately 0.4%.

Russian Market

Tuesday expect growth of quotations of securities of Russian companies, the leaders have the chance to lift shares of banks.

the next trading session promises to be busy information: UK Office for National Statistics publish data on the evolution of consumer prices in June at 12:30. Research institute ZEW will publish the July index of confidence of investors and analysts to the economy of Germany in 13:00. At the same time, the Statistical Office of the European Union voiced indicators of industrial production in May. United States Department of Labor will publish data on the dynamics of producer prices in June at 16:30. Ministry of Commerce will release data on the volume of retail sales in June, as well as stocks of goods in warehouses in May at 16:30 and 18:00 respectively.

Today begins a two-day meeting of the Bank of Japan, as a result of which will be announced as the basic interest rate in the near future.

The financial statements for the past quarter is expected to issue a Goldman Sachs, Intel Corporation, Johnson Johnson, Yum! Brands Inc.

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For the first time the support is not passed. The level of 850-860 points on the MICEX index was unavoidable (yet) for sellers, and quotes black gold also fell on the support of $ 57-59 per barrel. In the end, after gepa down on the market almost immediately followed by active buying, growing in the second half of the tenders. In doing so, the market looked more ordinary and preferred securities of Sberbank of Russia, as well as the oil sector, which is positive for a dramatic weakening of the ruble. As for the banks, in this case is likely to affect expectations of accountability as the Sberbank (today it must account for the I quarter of 2009 under IFRS) and the number of American banks, which will follow this week.

In addition, yesterday's growth we have another news: the head of the ECB Jean-Claude Trichet said that plans to continue to redeem bonds secured by the program, calculated on the € 60 billion and in 2010. Also yesterday, the ECB is further secured bonds bought at € 43 million we believe that it is necessary to draw attention to the news and the unexpected failure of Russian and U.S. indices to break down levels of support - previously we have seen similar surges of optimism against the backdrop of reports of additional financial injections into the economy.

Regarding the situation in the market as a whole, in this case, although the formation of rebound and the growth opportunity in a day or two possible, we do not expect that this growth will be the foundation for a new sustained rally in the market . Most likely, the upward trend may be limited to 920-930 area for items on an index of MICEX, where the medium-term down trend.

Today

leading world markets on Monday closed down a significant increase in: German DAX 3,19%, Britain's FTSE 1,82%, DJIA 2,27%. Asian markets this morning, mostly increasing, while Japanese Nikkei225 adds 2.34%. Futures on the S P500 grow at 0.20%.

Pair EUR /USD is in the € /$ 1,3901, while USD /JPY - in $ /#165; 92.14. Gold is $ 909.44 per troy ounce, silver - $ 12.86 per troy ounce, Copper - $ 4,952, and nickel - $ 15,080 per metric ton.

Yield for UST-2, 0,92; for UST-10 3,38.

Oil Prices in the last 24 hours have increased by $ 1.68 to $ 61.38 a barrel varieties Brent.

So, today we are waiting for the growth of quotations on the Russian securities market in early trades.

Today, at 12.30 GMT in the United States will be the index of producer prices (Producer Price Index, PPI) and data on changes in retail sales (Advance Retail Sales). And in the 14.00 GMT - statistics on changes in stocks in commercial storage (Business Inventories).

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