Economy and politics

According to the early morning announcement of the State Statistics Committee of Ukraine, inflation in October hit 1.7% MoM (18.0% YTD and 23.2% YoY). This is the lowest September inflation since September 2005, when it was 0.9% MoM. In October 2006 and October 2007, MoM CPI growth was 2.6% and 2.9% respectively.

Yesterday the Interbank currency market experienced a sharp appreciation of hryvnya from 6.5/7.0 in the beginning of the day to 6.0/6.4 at the session closure, as the National Bank of Ukraine (NBU) intervened with a USD sellout at the 5.95 UAH per USD level.

Over the weekend, the IMF announced that it is ready to grant a USD 16.5 bln standby loan to Ukraine to fight the economic crisis.

On the tail of a recent downgrade by S&P of 3Ukrainian banks, Tuesday brought upsetting news to the country’s financial sector, as both the Fitch international rating service and Moody’s Investors Service downwardly adjusted their outlook on Ukraine.

The State Statistics Committee of Ukraine announced that unemployment in September stayed at the 1.8% level, the same as in August and July 2008.

The merchandise balance deficit in Ukraine for January-August is USD 12.5 bln; USD 1.4 bln higher than in January-July and USD 6.5 bln times higher than for the same period in 2007.

The PFTS Index Committee has approved changes to the PFTS index basket and a new methodology for calculating the index basket. These changes will come into effect as of October 15 and October 13 respectively.

The State Statistics Committee of Ukraine has announced that real GDP in January-September 2008 grew 6.9% YoY. At the same time, real GDP in September 2008 grew 5.5% YoY after a 10.9% YoY growth in August. The earlier-released figures for January-August 2008 announced 7.1% YoY growth.

The State Statistics Committee of Ukraine released figures on real industrial output growth in September 2008.

After consultations with major political forces on Wednesday, October 8, 2008, President of Ukraine Viktor Yuschenko dismissed the Ukrainian Parliament.