NBU raises Ukraine's GDP growth forecast for 2023, but is less optimistic for the next period

The National Bank of Ukraine (NBU) has improved its forecast for the country's real domestic product (GDP) growth in 2023, raising it from 4.9% to 5.7%, but maintained its expectations for 2024 at 3.6%. According to NBU Governor Andriy Pyshnyi at a press briefing, this positive trend is driven by higher harvests of late crops and the development of alternative export routes.

Mr. Pyshnyi also noted that the high level of adaptability of businesses and households to the war conditions, as well as loyal fiscal policy supported by international financing, contributed to the positive trends in the economy.

A slight decline in inflation has led to a revision of Ukraine's nominal GDP forecasts for 2023 to UAH 6.51 trillion, as well as lower forecasts for 2024 and 2025. However, Pyshnyi is confident that Ukraine's economy will recover and continue to grow in the coming years.

The NBU forecasts that in 2024, real GDP will grow by 3.6%, thanks to high budget expenditures and expected international aid. However, economic growth is expected to decelerate due to lower harvests and imbalances in the labor market.

The NBU expects economic growth to accelerate to 4-6% per year in 2025-2026, as a result of lower security risks, improved consumer and investment sentiment, and the implementation of European integration reforms.