Inflation expectations of business circles in Ukraine in the third quarter improved and devaluation expectations grew, while the business expectations index exceeded 100%.
The assessments were recorded during a poll conducted by the National Bank of Ukraine (NBU) in August-September 2015, a total of 858 enterprises in 22 regions of Ukraine (not taking into account annexed Crimea and Donetsk and Luhansk regions) were surveyed.
"Ukrainian business improved its inflation expectations for the second quarter in a row. In the next 12 months companies expect that consumer prices could grow by 25.5% on average. In the first quarter they forecasted that inflation would be 27.3%, and in the second quarter – 27.1%," the NBU said on its website.
The regulator said that the expected growth of prices is linked to the hryvnia exchange rate and the increase of expenses on production. The pace of money supply in the economy, social expenses of the national budget, and the pace of prices on global markets have the smallest impact on growth of prices.
The NBU said that devaluation expectations grew in the past months: 80.7% of respondents predict that the hryvnia exchange rate could fall in 12 months, while in the second quarter 23.5% of respondents forecasted that the hryvnia exchange rate would be stable in the next 12 months.
The regulator said that in the third quarter the business expectations index grew by 5.6 percentage points compared to the previous quarter, to 100.2%, first after the second quarter of 2014 exceeding 100%.
The NBU said that agricultural and retail companies and companies that carry out imports transactions are the most optimistic ones.
According to the poll, in the third quarter 37.8% of respondents predicted the decline in product sales, while in the second quarter the share was over 50%.
The NBU said that companies forecast that their borrowing needs would grow in the near term. 34.9% of respondents plan to raise banking credits to finance their operations and 81.7% of respondents prefer credits in the national currency.
The share of companies which have no problems with carrying out transactions with funds placed on banking accounts (90.9% compared to 84.3% in the second quarter of 2015) grew for the second quarter in a row.
