Cabinet predicts inflation of 5.5% at end of 2020

Ukraine's Cabinet of Ministers has predicted that the inflation rate in Ukraine will not exceed 5.5% at the end of 2020.

Deputy Minister for Development of Economy, Trade and Agriculture Serhiy Nikolaichuk said this at a briefing on Tuesday, October 22.

"The Economy Ministry is now reviewing the inflation rate to decline, bringing it closer to the goals of the National Bank. Like the NBU, we believe that inflation will fall to the target corridor next year, and by the end of next year we expect 5.5 percent," Nikolaichuk said.

According to him, the hryvnia exchange rate is also expected to decline next year. The draft state budget for 2020 submitted to the Verkhovna Rada for consideration initially envisaged the exchange rate of UAH 28.2 per U.S. dollar, whereas now the government sees grounds for reduction, he said.

"We see that the hryvnia is stronger due to a number of fundamental factors and, accordingly, next year we are also setting the exchange rate not at a high level as was forecast. We will report in more detail after the government approves [the figures]," he said.

On October 18, the Verkhovna Rada approved a bill on Ukraine's state budget for 2020 (No. 2000) at first reading.

According to the document, state budget revenues are estimated at over UAH 1.079 trillion, including the revenues of the general fund at UAH 962.7 billion. Expenditures are projected at UAH 1.17 trillion.

According to the bill, Ukraine's economic growth next year is expected to accelerate to 3.3% of GDP with inflation expected to slow to 6%. The minimum salary in the 2020 budget is projected at a level of UAH 4,723.

op