21 May 2014
Industrial production fell 6.0% yoy in April, slowing down somewhat from -6.8% yoy the previous month, according to a state statistics release on May 19. The core sectors of the economy have deepened in their decline with chemical production falling 23.3% yoy (vs. -2.3% yoy in March), machinery shrinking 18.9% yoy (-17.4% yoy a month ago), and metals sliding 12.8% yoy (-11.1% yoy). At the same time, utilities significantly improved to +1.1% yoy from -8.3% yoy in the prior month. Mining was still in the red (-1.6% yoy) but somewhat better than a month ago (-3.5% yoy).
The April results imply that industry has extended its fall to -5.3% yoy in 4M14, from -5.0% yoy in 3M14.
Alexander Paraschiy: Though the April industry decline was somewhat smaller than a month ago it does not look like that situation is improving. Core industries are deeply in the red and the strengthened utilities performance on the back of abnormally cold weather for the month appeared to be the main reason of better monthly results. In fact, it has gotten worse than we had anticipated. The hryvnia decline has not helped exporters so far. Apparently, the turmoil in the east is standing behind this continued negative performance. Still, we hope that after the presidential elections, the situation at the east will stabilize and economic performance will improve. Thus we are keeping our industrial output forecast unchanged at -5.1% yoy for 2014.