Ukraine industry drop slows to 18% in June

Ukraine’s industrial output dropped 18.1% yoy in June compared to a 20.7% yoy plunge in the prior month, UkrStat reported on July 17. All key industrial sectors improved somewhat except for metal production. In particular, mining declined 20.1% yoy in June (compared to 20.6% yoy in May), chemical production fell 19.4% yoy (-29.0% yoy), machinery declined 16.7% yoy (-26.7% yoy), and utilities shrunk 15.5% yoy (-16.9% yoy). The metal production slump deepened to 27.1% yoy compared to 24.6% yoy in the prior month. The industrial output slump in the Luhansk region improved to -78.0% yoy compared to a 86.0% yoy drop in May, while output in the Donetsk region slightly worsened to a 46.6% yoy decline compared to a 45.9% yoy drop a month ago.

Alexander Paraschiy: June industrial output was better than we expected. We assumed a 20% monthly decline to be sustained till July. We projected improving statistics only starting in August based on a low comparative base. Instead, industry started strengthening already in June as part of what promises to be faster recovery in 2H15. So far, we are keeping our initial forecast for 2015 industrial production unchanged (-14.6% yoy). However, we see grounds for an upward revision of our projections if the positive trend in industry continues.