KIEV, Sept. 8 - Ukraine's central bank said on Thursday that a new aid installment from the International Monetary Fund would reduce volatility in the currency market and underpin reforms that are key to putting Ukraine on a path of sustainable economic growth, Reuters reported.

The IMF announced on Wednesday that it would discuss disbursing a new loan on Sept 14, part of a $17.5 billion bailout for Ukraine's war-battered economy.

"...a positive decision of the Fund will eliminate the psychological pressure on the foreign exchange market and support the trend towards a decrease in the hryvnia exchange rate volatility, the first signs of which were observed in the last few days," the bank said on its website.

The IMF said last week it was "very close" to concluding its latest review of Ukraine's bailout and expects its board to consider releasing additional funds in the second half of September.

"I think we are very close to concluding" the Ukraine review, IMF Managing Director Christine Lagarde told Reuters in an interview on Sept. 1.

The government of President Petro Poroshenko has been "very focused on responding to the international community requests concerning the fight against corruption, concerning the financial status of the banking system, concerning the latest reforms that were included in the program," Lagarde said, adding that implementation of reforms was needed to sustain the program.

Neither Lagarde nor Rice discussed the amount expected to be released to Ukraine in the next tranche.

The latest IMF tranche was initially envisaged at about $1.7 billion. Some Ukrainian officials have said they expected the amount to be reduced because of slower-than-expected progress on reforms aimed at limiting the power of vested interests and modernizing the economy.

Since August 2015, Ukraine has received no new IMF disbursements from the bailout package approved in April 2015.

The IMF loans have helped Ukraine pull itself out of two years of economic recession caused by a separatist conflict in its industrial east. But a third tranche of cash from the Fund has been delayed since October due to political upheaval. (rt/ez)