Ukrainian interbank lending rates soared to a one-year high as policy makers' bid to prop up the currency depletes cash from the economy and threatens to deepen the country's third recession since 2008.

The KievPrime overnight index, which shows one-day borrowing costs for the country's lenders, jumped to 20 percent at today's daily fixing from 12 percent on Dec. 6 and 4.32 percent on Nov. 29. Investors sold Ukraine's dollar notes, driving yields to record highs, after the country's foreign reserves dwindled 9 percent last month, according to central bank data published on Dec. 6.

The surge in rates that banks charge each other for short-term loans signals that Ukraine's efforts to prevent a devaluation are creating cash shortages that could hinder lending in an economy that shrank 1.5 percent in the third quarter. Pressure on the hryvnia has mounted as hundreds of thousands of anti-government protesters demonstrated in Kiev last weekend to maintain pressure on President Viktor Yanukovych, after he halted talks on a pact with the European Union last month in favor of bolstering ties with Russia.