: :inin Kyiv (EET)

S&P forecast for Ukraine: Economy to grow by 1% amid 14% inflation by end of 2016

Standard & Poors Global ratings forecasts that Ukraine`s economy may grow by 1% by the end of the current year amid 14% inflation and the average annual forex rate set at UAH 25.6 per U.S. dollar.

The rating agency projects that Ukraine`s macroeconomic situation will improve, and its economic growth will be between 2.3-2.9% by 2019 while inflation will drop to 9.5-7% by 2019.

The forex rate is expected to be UAH 27.2 per U.S. dollar.

”Ukraine`s economy has returned to growth in the last two quarters, and we forecast real GDP growth of 1% for 2016 despite weak exports, ongoing security risks, the weak domestic business environment, and the need for fiscal prudence. We expect continuing growth over the forecast period; a pick up in the later years should lead to GDP growth averaging 2.3% annually between 2016-2019,” the agency said in its Research Update on Ukraine.

S&P Global Ratings confirmed Ukraine`s sovereign rating at `B-B` with the stable outlook.

As UNIAN reported earlier, Ukraine`s Cabinet of Ministers projects GDP growth at 1% in 2016 and at 3% in 2017. Inflation in 2017 is forecast by the Ukrainian government at about 8.1% while the forex rate is expected at UAH 27.2 per U.S. dollar.


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