S&P forecast for Ukraine: Economy to grow by 1% amid 14% inflation by end of 2016

12:34, 12 December 2016
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S&P Global Ratings forecasts that Ukraine's economy may grow by 1% by the end of the current year amid 14% inflation and the average annual forex rate set at UAH 25.6 per U.S. dollar.

Photo from UNIAN

The rating agency projects that Ukraine's macroeconomic situation will improve, and its economic growth will be between 2.3-2.9% by 2019 while inflation will drop to 9.5-7% by 2019.

The forex rate is expected to be UAH 27.2 per U.S. dollar.

"Ukraine's economy has returned to growth in the last two quarters, and we forecast real GDP growth of 1% for 2016 despite weak exports, ongoing security risks, the weak domestic business environment, and the need for fiscal prudence. We expect continuing growth over the forecast period; a pick up in the later years should lead to GDP growth averaging 2.3% annually between 2016-2019," the agency said in its Research Update on Ukraine.

S&P Global Ratings confirmed Ukraine's sovereign rating at 'B-\B' with the stable outlook.

As UNIAN reported earlier, Ukraine's Cabinet of Ministers projects GDP growth at 1% in 2016 and at 3% in 2017. Inflation in 2017 is forecast by the Ukrainian government at about 8.1% while the forex rate is expected at UAH 27.2 per U.S. dollar.

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