significant budget deficit creates risks to exchange rate stability, reported on the website of the National Bank of Ukraine (NBU).

The formation of significant budget deficits in the context of limited real sources of its coverage is one of the major risks to macroeconomic stability, implementation of which can be displayed and the stability of the currency - the report indicates.

The report recalls that in the first half of 2009 the deficit of the consolidated budget was formed at the level of 13.264 billion UAH.

Thus, according to a report on the dynamics of budgetary performance negatively affected by adverse situation in the economy: reducing the tax base (due to the deteriorating profitability of enterprises), falling real incomes of the population and, consequently, a reduction in domestic demand led to a decrease in revenues of the consolidated budget in January-June 2009 to 4% compared with the corresponding figure last year.

However, the costs of the consolidated budget of Ukraine have increased over the same period last year to 10,3%.

As reported, the state budget deficit in Ukraine in January-July amounted to UAH 15.352 billion, an increase from July at 44.8% or UAH 4.748 billion. The consolidated budget of the country, which includes the state budget and local budgets, for seven months recorded a deficit at the level of 17.837 billion UAH. According to the Ministry of Finance, on social spending for the seven months from the state budget is directed UAH 54.572 billion, or 42% of the cost.

The report of the National Bank also indicates that in the second quarter of the government to finance domestic expenditure budget heavily on funds from their foreign currency accounts by converting them into the hryvnia. The total amount of foreign currency, which the government sold the National Bank of Ukraine for the period amounted to about $ 1.3 billion

In addition, according to the report, the National Bank in the first half of 2009 carried out the operation for redemption of government bonds to 20.2 billion UAH: to increase the authorized capital stock in January and June 2009 issued state bonds totaling $ 4.7 billion UAH.

National Bank also notes that in June this year the Ministry of Finance increased the yield on government bonds, which are placed on primary auctions: in January-May, the yield on such securities depending on the duration ranged 15,6-20, 2% per annum, then in June - within 19,31-22,67%. Average yield on bonds of internal state loan (Government Bonds) during the initial public offering in January-June 2009 amounted to 13,85%.

According to a report in the first half was a tendency to reduce the volume of participation in the government securities market to foreign investors. Volume of Government Bonds in the ownership of non-residents during this period decreased by 311.7 million UAH - to UAH 155.5 million, representing 0.4% of the total amount of Government Bonds in circulation.

As reported, the income of the state budget for 2009 approved (with changes) of $ 239.2 billion UAH, expenses - 267.7 billion UAH, while limiting the size of the deficit state budget for 2009 set at 31.2 billion UAH.

Ukraine's state budget includes general fund, which are sent taxes and fees, and from which funds basic expenses, and a special fund, whose assets were earmarked. In this case the state budget deficit is calculated as the difference between the amounts of his income and returned to the budget credits, as well as costs and granted loans from the state budget.