Fitch: Ukraine GDP to Slow

Fitch international rating agency has lowered the forecast of GDP growth in Ukraine in 2017 from 2.5% to 2%, Ukrainian News reported. “Ukraine’s GDP grew by 2.3% in 2016, which exceeded expectations, but the blockade will have a negative impact on the mining, metallurgy and electricity sectors, and we expect that growth in 2017 will slow to 2%,” Fitch said. However, the GDP growth in 2018 could increase to 3% due to improved consumer demand and investment. The agency also predicts average inflation in 2017 at 11.2% compared with 14.9% in 2016. At the same time, the statistics committee registered an increase in consumer prices in 2016 by 12.4%. Fitch Ratings has also affirmed Ukraine’s long-term foreign- and local-currency issuer default ratings at ‘B-’ with a Stable Outlook. “The ratings of Ukraine have weak liquidity, high debt burden and structural weaknesses associated with weak banking sector, institutional constraints, geopolitical and political risks,” the agency said.