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Ukraine's central bank downgrades economic growth forecast for 2016

Xinhua, January 29, 2016 Adjust font size:

Ukraine's central bank on Thursday lowered its estimate for the country's gross domestic product (GDP) growth in 2016 to 1.1 percent, down from an earlier projection of 2.4 percent.

"A weaker than previously expected economic recovery can be attributed to lower-than-expected global commodity prices, deteriorating global economic growth prospects, and fresh trade restrictions imposed by the Russian Federation," the bank said in a statement on its website.

It nevertheless maintained the inflation forecast for 2016 at 12 percent, saying that the projection is based on stable global prices on Ukraine's main imports items -- energy and food, as well as on cancellation of Kiev's import duties on certain types of goods.

The Ukrainian budget for this year is based on a 2-percent economic growth and an inflation of 12 percent.

Ukraine's economy, which has sunk into recession at the beginning of 2014, demonstrated a weak performance last year, with the country's GDP falling by an estimated 11 percent.

The annual inflation in the East European country in 2015 stood at 43.3 percent. Endit