According to preliminary data, the BOP current account deficit decreased to USD 226 million in August against USD 597 million in July. It was caused by a reduction in the trade in goods deficit and an increase in the trade in services surplus.
In comparison with the previous year, in January – August 2017, the current account deficit increased by only USD 0.3 billion, totaling USD 2.1 billion. The deficit increase was restrained by the favorable external economic situation, last year's good harvest, continuing rise in exports of services (primarily, against the backdrop of growing volumes of gas transit), and an increase in money transfers. These factors compensated the effect of termination of trade with the non-government controlled areas and that of more sizable volumes of natural gas purchase.
In August, exports of goods amounted to USD 3.3 billion. Their increase speeded up to 12.8% yoy (from 9.3% in July), being mainly attributed to a rise in exports of sunflower oil and oil-bearing seeds.
In August, exports of grains temporarily decreased due to weaker demand in some countries against the backdrop of their own good harvests. At the same time, exports of other foods kept on growing at a high pace, thereby ensuring an increase in exports by 17.5% yoy.
In August, metallurgical exports went up by 8.1% yoy in value terms owing to a rise in global prices and shifting of metallurgical plants towards new suppliers of raw materials after the break of trade relations in the east of the country.
During the eight months of the current year, exports of goods rose by 21.0% yoy (in January - August 2016, they fell by 10.1%). EU countries remain the largest trading partner of Ukraine, with their share in total exports reaching 35.0%.
In August, imports of goods came to USD 4.2 billion. Their growth was slowing down for the third month in succession, having reached 10.4% yoy.
Particularly, against the backdrop of a high comparison base, energy imports shrinked to 30.1% yoy from 57.8% yoy in July. Physical volumes of imported natural gas remained sizable (1.2 billion cu. m); nevertheless, they were 12.7% yoy lower at the expense of stepped-up purchases in August of the previous year.
Imports of other fuels kept up growing at a fast pace. Imports of coal in value terms were twice as much as in the previous year due to a deficit in its supply in the domestic market. An increase in purchases of oil products in value terms also speeded up, to 28.3% yoy, against the backdrop of gradually rising global oil prices.
At the same time, given a high comparison base, non-energy imports, primarily, machinery imports, slowed down its increase (to 5.4% yoy).
Overall, during the eight months of the current year, imports of goods rose by 22.1% yoy at the expense of high volumes of energy and agricultural machinery purchases. Thereby, the share of EU countries within total imports of goods reached 37.9%.
In August, net inflows in the financial account showed a sizable increase as compared with July (up to USD 743 million) and were backed by private sector's transactions. Like previously, this was primarily caused by a reduction in FX cash outside banks, which speeded up to USD 496 million in August. Furthermore, external assets of the banking sector decreased by USD 0.3 billion at the expense of purchases by banks of domestic government bonds denominated in foreign currency, which were issued by the government.
Net FDI inflows increased to USD 194 million, 85% whereof was channeled to the real sector. During the eight months of the current year, direct FDI inflows (excluding debt-to-equity transactions) were twice as much as in the corresponding period of the previous year (USD 1.2 billion against USD 0.7 billion, respectively).
At the same time, in August, the private sector recorded an inconsiderable outflow of debt capital (USD 125 million). This was primarily caused by banks' repayments on interbank loans and deposits and decreasing borrowings by the real sector.
In August, the balance of payments of Ukraine was in surplus amounting to USD 518 million. This made it possible to repay, according to the schedule, the debt to the IMF in the amount of USD 363 million and to accumulate international reserves. During the eight months, the consolidated BOP surplus reached almost USD 1.3 billion (in the corresponding period of the previous year – USD 533 million).
Ukraine's international reserves stood at USD 18.0 billion as of 1 September 2017, covering 3.6 months of future imports.
See updated data for August 2017 under External Sector Statistics section.
See the Macroeconomic and Monetary Review (September 2017), for greater details on macroeconomic developments in August, which will be published on 29 September 2017.