By KYIV. Nov 3 (Interfax-Ukraine) – The Ukrainian government has improved the inflation forecast for 2024 from 10.8% to 9.7% and adjusted the assumption about the average annual hryvnia exchange rate next year to UAH 40.7/$1 compared to UAH 41.4/$1 in the preliminary forecast.
According to the Ministry of Finance, this updated forecast forms the basis for the draft state budget for 2024 approved by the government on Thursday, November 2, for the second reading.
The Ministry of Finance clarified that such changes are related to the revision of the macro forecast for 2023. In particular, the GDP growth estimate was improved from 2.8% to 5%, the inflation forecast was reduced from 14.7% to 7.1%, and expectations for the hryvnia exchange rate at the end of the year were reduced to UAH 38.6/$1 from UAH 40.2/$.
As reported, the National Bank of Ukraine (NBU), which has maintained the official hryvnia exchange rate of UAH 36.5686/$1 since the end of July 2022, switched to a regime of managed exchange rate flexibility on October 3. However, at the end of the month, the official exchange rate even strengthened to UAH 36.2812/$1, despite the increase in the National Bank’s interventions to $3.337 billion, a record level since July 2022.
