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3.2 Macro outlook
According to the State Statistics Service, in the third quarter of last year, real gross domestic product (GDP) in annual terms showed growth for the eleventh quarter in a row , while slowing to 2.8% after accelerating for two consecutive quarters – up to 3.1% in 1Q and up to 3.8% in 2Q 2018.
The rise of industrial output in January-November last year compared to the same period of 2017 was only 1.6%, while in November, a 0.9% drop was reported.
The deficit of foreign trade in goods and services, according to the National Bank, for January-October 2018 exceeded $10bn, which is 1.5 times higher year-on-year.
Agricultural output for eleven months, due to favorable weather conditions and enhanced efficiency of agribusinesses, was up 8.2%. Last year, Ukrainian farmers harvested a record 70mn tonnes of grains, which is 4mn tonnes higher than the previous maximum.
The income of Ukrainians has also been growing – the average salary in October rose by almost 25% compared with the previous year. This contributed to the retail trade turnover in January-November growing 6.2% in annual terms.
A steady demand on the real estate market pushed construction works up by 6.3%.
At the same time, sadly, inflation has been chopping off bits of the rising incomes. In November, inflation accelerated to 10% in annual terms.
Ukraine's national currency, the hryvnia, survived the year quite confidently, having even strengthened against the US dollar at the official rate of the National Bank of Ukraine (NBU) by 1.5%, to UAH27.68/$. The average rate for the year amounted to UAH27.22/$. This year's forecasts made by Ukrainian authorities and key creditors are quite cautious. In 2019, the National Bank predicts economic growth at 2.5% with inflation at 6.3%, the Cabinet of Ministers – at 3% with inflation of 7.4%.
The International Monetary Fund expects that in the coming year, Ukraine’s economy will grow by 2.7% with inflation at 7.3%, while the World Bank expects GDP growth of 4% with inflation at 7.3%.
26 UKRAINE Country Report February 2019 www.intellinews.com