Financial sector news

For the second month in a row, Ukrainian businesses have been adapting to the difficult conditions of the war and demonstrating positive expectations for their operations. This conclusion is based on data from Monthly survey of Ukrainian enterprises conducted by the National Bank of Ukraine (NBU) in April 2024.

In April, the Index of Business Expectations (“IBE”) increased to 52.3 points, compared to 52.0 points in March. This indicates that businesses expect economic performance to improve in the near term.

Optimism is supported by a number of factors, including:

• Expectations of increased international financing and improved supply chains.
  
• Seasonal recovery of business activity and growth in domestic demand.
  
• Slowdown in inflation.
  At the same time, the business faces a number of challenges, such as:
• Damage to energy facilities.
  
• Increased logistics and labor costs.
  
• Lack of qualified personnel.
  Despite these challenges, construction and service companies show the highest level of optimism. They expect an increase in business volumes, purchases of raw materials, and new orders. Industrial and trade enterprises also maintained positive assessments of production volumes, new orders, turnover, and purchases.

Against the backdrop of high growth rates in purchase prices, companies in all sectors expect further increases in the price of their products and services. The situation on the labor market remains unstable. Only respondents from the construction industry expect a slight increase in the number of employees. Respondents from other sectors, on the contrary, predict a slight reduction in staff.

Overall, the survey results show that Ukrainian businesses are gradually adapting to the new working conditions in the wartime environment. Expectations of business activity are rising, giving rise to cautious optimism about the prospects for economic recovery.