Economy ministry downgrades 2020 macro forecast to factor in virus

Ukraine’s economy ministry has dramatically updated
its 2020 macroeconomic forecast while developing the amendments to the 2020
state budget. The 2020 GDP forecast been downgraded to a 3.9% yoy decline from
3.7% yoy growth. The updated forecast assumes consumer inflation of 8.7% yoy
(vs. 5.5% yoy previously), and an average exchange rate of UAH 29.50/USD (vs.
UAH 27.00/USD previously).

Nominal GDP is forecasted at UAH 4,000 bln (vs. UAH
4,510 bln previously), while the average monthly wage is expected at UAH 11,000
(vs.  UAH 12,500 previously). The unemployment forecast has been revised
to 9.4% from 8.1% previously.

Evgeniya Akhtyrko: This update is needed as a rationale for amending budget parameters to
account for a significant deficit enlargement. This updated forecast reflects a
situation in which current quarantine restrictions would last up to two months,
according to our estimates. In case of a longer quarantine, much dramatic
economic losses are inevitable.