Ukraine Treasury residuals fall 23% m/m in April

Ukraine’s Treasury residuals fell to UAH 16.3 bln as of May 1, compared to UAH 21.1 bln in the prior month and UAH 23.6 bln a year before, according to a State Treasury report released on May 4. The highest level of Treasury accumulations in Ukraine’s history of UAH 48.0 bln, or 2.4% of GDP, was reached in early December 2015, according to the report.

Alexander Paraschiy: The April residuals are a sign that a slowdown in budget revenue is continuing. Last week, the Treasury reported that March general budget revenue increased only 9.6% yoy compared to 16.2% yoy in February and 32.7% yoy in January. April revenue most likely maintained this sliding trend. Still, it’s too early to talk about any risks to meeting the 3.7% of GDP deficit committed to the IMF. General budget revenue growth rates remain high when considering 16.5% yoy growth for 1Q16. What’s more, the result was achieved without any support from the National Bank so far. Throughout the year, UAH 38 bln in NBU profits are still planned to be wired to the budget.