The National Bank of Ukraine (NBU) believes that economic growth in 2017 could exceed the regulator's July forecast of 1.6% year-on-year growth, the central bank said in its statement published on September 20.
"The current dynamics of the real sector indicators and the results of the first half of 2017 demonstrate an increase in the probability that economic growth in 2017 will exceed the forecast of the NBU, announced in the inflation report for July," the satement reads.
The statement followed by the state statistics service Ukrstat's decision to downgrade its estimates of the country's GDP growth from 2,4% y/y to 2.3% y/y in April-June. In the first quarter of the year, Ukraine's economy increased by 2.5% y/y.
In July, the NBU revised downwards its forecast for real GDP growth for 2017 to 1.6% from its 1.9% y/y projection in April. The move was attributed to the worse economic performance in the first half of the year, primarily in services, and the revised crop yields assessments. Industries most susceptible to the severance of production ties with the rebel-held Donbas territories, the mining and metals sector, energy industry, transport industry, will continue to underperform.
In April, the NBU confirmed its revised 2017 GDP forecast from 2.8% to 1.9% growth year-on-year due to expectations that a trade blockade in eastern Ukraine and the loss of the production facilities in the rebel-held areas in the Donbas region will decrease the output of some industries.