Preliminary data show that in April 2014 the overall balance of payments was all but sound for the second month in a row  (-USD 232 million). The current account has shown a surplus of USD 186 million for the first time since January 2012. In April 2013, the current account deficit was USD 1.1 billion.

The country's external position has been put back on track due to a dramatic fall in imports (by 30%) as a result of the devaluation of the national currency (since the start of the year, real effective exchange rate (REER) of the hryvnia has depreciated by 24.6%) and sustained slowing of economic activity.

Deputy Governor of the National Bank of Ukraine Borys Prykhodko said that the transition to a flexible exchange rate regime had enabled Ukraine to put the foreign trade back on track and preserve the gold and foreign exchange reserves.

Merchandise exports had fallen by 12.1% yoy due to weak external demand. Exports of chemical products and metallurgical exports had shrunk the most. However, Mr Borys Prykhodko pointed out that agricultural exports had risen by 8.9%.

Overall, non-energy imports had plunged by 35.3% yoy, Imports of all major commodity groups recorded a decline. In particular, imports of cars had plunged by 72.9%, whereas that of foodstuffs had fallen by 34.3%.

Mr Borys Prykhodko also noted that Ukraine had stepped up the process of import substitution with domestic production. In particular, Ukraine saw a 53.5% fall in imports of mineral fertilizers as agricultural producers were gradually switching from imported mineral fertilizers to their import substitutes.

The balance of loans and bonds had recorded a surplus for the second month in a row, amounting to USD 223 million in April.

The Deputy Governor of the National Bank of Ukraine said that devaluation expectations had eased in April. As a result, the net accumulation of foreign cash holdings outside banks had declined to USD 167 million.