Ukraine C/A deficit reaches USD 0.5 bln in August
1 October 2019
Ukraine’s current account (C/A) deficit reached USD
512 mln in August, shrinking somewhat from USD 595 mln in July, the National
Bank of Ukraine (NBU) reported on Sept. 30. The trade deficit contracted to USD
1.2 bln from USD 1.4 bln in the previous month. The primary income surplus
amounted to USD 407 mln (vs. USD 478 mln in July), while the secondary income
surplus was USD 258 mln (vs. USD 303 mln in July).
In 8M19, the C/A deficit amounted to USD 1.8 bln (vs.
USD 2.0 bln in 8M18).
In August, the goods trade deficit swelled to USD 1.3
bln from USD 1.0 bln in July. Goods exports growth slowed to 5.6% yoy to reach
USD 4.9 bln (vs. a 20.8% yoy surge in July). Goods imports slowed to 8.2% yoy
growth to reach USD 5.2 bln (from 9.1% yoy growth in July). The weaker export
growth was mostly due to a 16.0% yoy fall in metal exports (vs. 1.2% yoy growth
in July). In addition, machinery exports declined 0.8% yoy (vs. a 43.2% surge
in July). Food exports slowed to 19.7% yoy growth (vs. a 36.5% yoy jump in
July).
The slower growth of goods imports was mostly due to
weaker growth of machinery imports (24.8% yoy growth in August vs 36.0% yoy in
July).
The financial account surplus shrank to USD 0.6 bln
from USD 1.8 bln in July. The foreign currency inflow was mostly generated by
trade credits (the net inflow of USD 740 mln) and foreign direct investment
(the net inflow of USD 294 mln).
The surplus of Ukraine’s balance of payments amounted
to USD 130 mln in August (vs. USD 1.3 bln in July). In 8M19, the balance of
payments surplus amounted to USD 2.2 bln (vs. a USD 0.16 bln surplus in 8M18).
Evgeniya Akhtyrko: The high
volume of agricultural exports and weak energy imports helped to keep the C/A
deficit in moderation. However, we expect this export growth to slow through
the year end owing to the high comparative base of the previous year. At the
same time, the appreciation of the national currency might further fuel
imports, especially among consumer goods.
We project the C/A deficit to grow to USD 5.4 bln
in 2019 (vs. USD 4.3 bln in 2018) due to the widening trade deficit.
