The Institute for Economic Research and Policy Consulting: Monthly Economic Monitoring for Ukraine, March 2023

2023-04-13 | Expert publications, State of the economy

The Institute for Economic Research and Policy Consulting has published the March 2023 Monthly Economic Monitoring for Ukraine.

Key takeaways:

In March 2023, according to the IER, real GDP grew by 28% year-on-year (yoy). However, it should be noted that since March, annual figures are compared to the period of russia’s fullscale war against Ukraine. Therefore, compared to March 2021, the current GDP decline would be 31%.
The State Statistics Service has released GDP data for 2022: real GDP contracted by 29%, while nominal GDP decreased only by 5%.
Efforts by energy companies to increase their own gas and coal production are growing, which is expected to contribute to Ukraine’s energy independence.
The Grain Initiative has been extended for 120 days, although russia continues to claim that it has agreed only to 60-days extension.
The foreign trade deficit in goods and services remained significant in the first two months of 2023 but was financed by international assistance inflows.
Changes in IMF policies have allowed Ukraine to receive a full EFF program of USD 15.6 bn, which is part of a USD 115 bn assistance package.
Inflation continued to slow down and reached 21.3% yoy in March. This trend is expected to continue for at least until June.
The NBU continued to adjust its policy on reserve requirements for banks to encourage them to increase interest rates on bank deposits.