Ukraine C/A surplus reaches USD 0.4 bln in August

Ukraine’s current account (C/A) reached a USD 370 mln
surplus in August, compared to a USD 147 mln deficit in July, the National Bank
of Ukraine (NBU) preliminarily reported on Sept. 30. The trade deficit shrunk
to USD 77 mln from USD 586 mln in July. The goods trade deficit shrank to USD
0.5 bln from USD 1.0 bln in August. The primary income account reached a USD
178 mln surplus (vs. a 129 mln surplus in July), while the secondary income
account surplus amounted to USD 851 mln (vs. a 269 mln surplus in July).

 

In 8M20, the current account surplus amounted to USD
4.2 bln (vs. a USD 3.7 bln deficit in 8M19).

 

Goods imports slid 17.8% yoy to USD 4.3 bln in August,
compared to a 21.2% yoy plunge in July. The decline was mostly due to a 44.3%
yoy drop in mineral product imports (vs. a 44.5% yoy fall in July) and a
decline of machinery imports of 12.7% yoy (vs. 16.8% yoy in July). Meanwhile,
food imports jumped 21.2% yoy (vs. a 15.1% yoy growth in July). In 8M20, goods
imports dropped 17.1% yoy.

 

The decline in goods exports slowed to 2.0% yoy to USD
3.9 bln in August from a drop of 15.4% yoy in July. In particular, food exports
advanced 3.1% yoy (vs. a 16.1% yoy decline in July), while machinery exports
surged 15.2% yoy (vs. a 10.5% yoy fall in July). The decline of ferrous metals
exports slowed to 7.0% yoy (vs. a 23.3% yoy drop in July). Meanwhile, exports
of mineral products plummeted 20.3% yoy (vs. a 21.4% yoy drop in July). In
8M20, goods exports declined 6.7% yoy.

 

The financial account was almost balanced with a USD
19 mln deficit in August (vs. a USD 58 mln surplus in July). In particular, the
net outflow from the public sector of USD 272 mln was compensated by the net
inflow to the private sector of USD 253 mln.

 

Ukraine’s balance of payments switched to a USD 353
mln surplus in August from a USD 88 mln deficit in July. In 8M20, the surplus
of the balance of payments amounted to USD 1.5 bln (vs. a USD 2.1 bln surplus
in 8M19).

 

Evgeniya Akhtyrko: These
figures fulfill our expectations about the current account balancing out.
Goods exports showed some positive dynanics in August, but their sustainability
for the near term cannot be assured as the pandemic situation might change very
fast.

 

Goods imports remain weak because of falling imports
of energy resources and investment goods. Meanwhile, food imports have been
picking up fast amid relatively strong private consumption.

 

We do not expect dramatic changes in current trends in
Ukraine’s external accounts in the upcoming months. The current account is
likely to remain balancing out.