Ukraine's consolidated balance of payments deficit narrowed substantially to 0.5% of GDP in June - NBU

MOSCOW. Aug 1 (Interfax) - Ukraine had a consolidated balance of payments deficit of $0.9 billion or around 0.5% of GDP in June compared with a deficit of $3.4 billion or around 1.8% of GDP in May 2024, Ukrainian media reported, quoting the National Bank of Ukraine.

There was a consolidated balance of payments surplus of $1 billion in June 2023.

The current account deficit in June 2024 excluding reinvested income and grants from international partners was $2.1 billion, compared to $1.6 billion a month earlier and $1 billion in June 2023.

The deficit arose primarily from a wider merchandise trade deficit due to high imports and absence of grants from international partners.

The current account deficit widened to $8.7 billion from $6.9 billion in January-June 2024 and, excluding reinvested income and grants from international partners, it widened to $8.2 billion from $7.1 billion.

The NBU said merchandise exports in June fell 4.3% year-on-year and fell 19.7% compared to May 2024 to $2.7 billion, while imports increased by 5.5% and decreased by 1.7%, respectively, to $5.4 billion.

The services trade deficit fell to $0.5 billion in June this year from $0.6 billion in June last year with exports up 0.7% and imports falling 4%.

The primary income surplus was level with June last year at $0.4 billion while the secondary incomes surplus narrowed to $0.6 billion from $2.3 billion.

The NBU's June financial stability report forecasts a gradual widening of the current account deficit despite an improving trade balance.

"Ukrainian exports will recover slowly, primarily due to the stable operation of the maritime corridor [...]. However, relatively low world prices by historical comparison are keeping export revenue growth in check. But import volumes are increasing, fueled by consumer demand," the report said.