Ukraine industrial output slows to 0.8% growth in October

Ukraine’s industrial output slowed to 0.8% yoy growth in October owing to a sudden drop in chemical output of 5.2%, according to state statistics released on Nov. 22. Industry grew 2.0% in September, included 4.8% growth in chemical output. For 10M16, industry increased 1.9% yoy.

Mining declines lessened to -1.9% yoy in October from -5.4% yoy in September. Growth in both utilities and machinery slowed to +3.7% yoy (+5.0% in Sept.) and +2.5% yoy (+4.5% in Sept.), respectively. In contrast, metals substantially strengthened to +2.4% yoy from -0.6% yoy in the prior month.

Alexander Paraschiy: We anticipated better industrial performance amid reviving metal and iron ore prices. The October numbers confirm that volatility dominates the economy. In the last two months of the year, we might see more surprises with industry production but we still anticipate industrial growth close to +2.0% yoy for the year, as we estimated previously.

In regards to 2017 prospects, we expect the general pattern to remain effectively the same, with sluggish external demand. What’s more, we anticipate that building growth next year will become even more challenging amid a higher comparative base. Against this backdrop, we expect industrial growth slowing to +1.8% yoy in 2017.