wiiw Forecast Reports
UKRAINE: Teetering on the brink
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The severe political crisis and the suspension of Russian credits have put the currency under strong downward pressure, prompting the National Bank to switch to a floating exchange rate regime and impose partial capital controls. The near-term economic prospects are hardly encouraging, with a balance-of-payments crisis and a bank run looming on the horizon. A ‘rescue package’ from the IMF is urgently needed to prevent this scenario. However, the ‘austerity’ conditionalities, which will likely be attached to such a package, will almost certainly push the economy into recession this year.
Countries covered: Ukraine