The deficit of Ukraine's balance of payments dropped sharply

Thu, 06.11.2014 17:20

KYIV/Ukraine in Arabic/ According to the National Bank of Ukraine (NBU), deficit of the current account in Q2 made up USD 1.1 billion and was the least since 2011 due to reduction of the hryvnia rate and reduction of internal demand.

As a result of the hryvnia devaluation and reduction of economic activity, the rates of the import fall considerably exceeded reduction of exports.

Deficit of the consolidated balance of payments of Ukraine reduced to USD 5 million in Q2 against USD 4.277 billion in Q1 of the current year.

A statement reads on the NBU website.

"Transfer to the policy of flexible rate formation caused close to zero balance of the consolidated balance of payments (- 5 million USD) in Q2 of 2014,” a report reads.

At the same time, balance of financial and capital accounts in Q2, 2014, made up USD 1.1 billion. “It became positive due to attraction of the state sector and reduction in the volumes of cash currency outside banks,” the NBU explained.

As noted, export of goods reduced by 6.5% in annual terms to USD 14.9 billion, as a result of weak internal demand and reduction of industrial production due to aggravation of the situation in the east of Ukraine.

“The fall took place both as a result of reduction in physical supply volumes (by 2%), and through reduction of prices (by 4%),” the regulator informs.

To remind, the balance of payments of Ukraine in January-September 2014 was made with deficit of USD 4.945 billion.


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