Economy and politics

According to a State Statistics Committee note, Ukraine’s net FDI inflow reached USD 10.1 bln in 2008, compared to USD 9.2 bln in 2007.

According to data released by the State Statistics Committee of Ukraine, Ukraine’s industrial output fell 34.1% YoY in January 2009, following a drop of 19.8% in October 2008, 28.6% in November, and 26.6% in December. Industrial output, therefore, fell 16.1% MoM in January 2009, as compared to a 12.4% drop in January 2008.

The trade balance deficit grew to USD 13.5 bln in 2008, as stated in a note by the State Statistics Committee of Ukraine. The figure amounts to nearly -8.4% of the anticipated GDP and is 70.9% of the 2007 USD 7.9 bln (-5.6% of GDP) trade balance deficit figure.

The IMF is urging Ukraine to contract its budget deficit, conduct stricter monetary policy, and closely control its banking sector, as outlined in a report by the IMF’s External Relation Department’s Senior Advisor, David Hawley.

Fitch has downgraded Ukraine’s long-term foreign and local currency issuer default ratings, as well as the Country Ceiling from ‘B+’ to ‘B’. The outlooks on both IDRs are negative. The short-term foreign currency outlook is affirmed at ‘B’.

Yesterday, the Minister of Finance Viktor Pynzenyk has submitted Parliament his resignation, justifying his decision in the inability to abandon the principles of a balanced budget with a minimum deficit, realistic revenue sources, and limits on government borrowings.

According to a recent note from the State Statistics Committee of Ukraine, the merchandise balance deficit in 2008 has slipped to USD 18.53 bln, which is 63.7% higher than the USD 11.32 bln 2007 merchandise deficit.

According to an announcement by the National Bank of Ukraine, the money base fell 3.6% to UAH 180 bln (USD 23.4 bln), while the money supply fell 4.6% to UAH 491.8 bln (USD 63.9 bln), in January.

According to a recent note from the State Statistics Committee of Ukraine, CPI grew 2.9% MoM (22.3% YoY), while PPI grew 0.2% MoM (20.4% YoY).

According to an announcement from the National Bank of Ukraine, the foreign reserves fell 8.6% reaching USD 28.82, a 15-month low.