Ukraine

Ukrainian President Volodymyr Zelenskiy met with European leaders to press for continued support against Russia’s invasion, amid concerns about the continued flow of U.S. aid, Bloomberg News reported. Zelenskiy kept fellow-leaders guessing about whether he would attend until the eve of a summit in Granada, Spain, because he sought concrete results from a trip, according to people familiar with his thinking. It was not clear to him whether allies were ready to deliver on concrete pledges, added the people who asked not to be named on a confidential issue.

The European Union is considering unlocking billions of euros for Hungary that were frozen over rule-of-law concerns as it seeks to win Budapest's approval for aid to Ukraine including a start to membership talks for Kyiv, senior officials said, Reuters reported. Hungary cultivates closer ties with Russia than other EU states, and is seen as the key potential opponent to a decision due in December on whether to open accession talks with Kyiv, which would require unanimous backing of the union's 27 members.

Ukraine's central bank said it would bring in a more flexible exchange rate from Tuesday, relaxing the official peg it has had throughout the war with Russia in a move to boost the economy, Reuters reported. Central Bank Governor Andriy Pyshnyi said financial stability in Ukraine had climbed to a "historic maximum", allowing the central bank to start easing wartime restrictions in a bid to help the economy and businesses. "Compared with July last year, the situation is radically different," Pyshnyi told an online media briefing.

Ukraine's economy is expected to grow by about 5% next year driven by investment in reconstruction and stronger consumer demand, a senior Economy Ministry official said on Tuesday, Reuters reported. Natalia Horshkova, head of the ministry's department for strategic planning and macroeconomic forecasting, said the ministry expected gross domestic product to grow by around 2.8% this year. "We expect 5% growth in 2024. The driver will be investment dynamics," she told a roundtable on the economy.

The role of Ukraine’s banking system is one of the less told stories of the nation’s resilience. It survived the loss of assets to occupation, power outages and a 30% collapse in GDP without bank runs, service interruption or any significant closures, Bloomberg News reported. State-controlled lenders have played a part. Before the war, the state-run lenders that control about half the system’s assets were seen as part of the country’s problem. They were notorious for poor governance and backroom deals with their government owners.

Ukraine's central bank could start cutting its key rate by one to two percentage points in coming months, notes from the central bank's committee for monetary policy showed on Monday, Reuters reported. The bank has kept its main rate unchanged at 25% since last summer, when it increased the rate to tame growing consumer prices fuelled by Russia's war in Ukraine. Recent economic and inflation trends offer grounds for cautious optimism, the central bank said, adding that the majority of members of its monetary policy committee assumed that rate cuts might start earlier than initially forecast.

The Ukrainian government will provide state guarantees to revitalise its export credit agency, a move designed to help domestic exporters and lift the economy after 14 months of war, Prime Minister Denys Shmyhal said on Tuesday, Reuters reported. Before Russia's full-scale invasion in February last year, Ukraine's economy was export-led, but Moscow's war in Ukraine has disrupted supply chains and logistics. "We are intensifying the work of the export credit agency. We want as many Ukrainian businesses as possible to export their products abroad," Shmyhal told a government meeting.

Ukraine secured promises of $5 billion in additional funding to support its ongoing fight against Russia amid "fruitful meetings" in Washington this week, Ukrainian Prime Minister Denys Shmyhal told reporters on Friday, Reuters reported. Shmyhal met with representatives of the International Monetary Fund, the World Bank and the European Investment Bank as well as top U.S. officials, on the sidelines of the spring meetings of the IMF and World Bank.

The World Bank on Wednesday said it would finance $200 million to help fix Ukraine's energy and heating infrastructure, with partners and others to provide another $300 million in additional funding as the project expands, Reuters reported. The $200 million grant will be used to make emergency repairs to Ukraine's transition transformers, mobile heat boilers and other emergency critical equipment, the World Bank said in a statement. Read more.

Ukraine and the International Monetary Fund have agreed on a $15.6 billion loan package aimed at shoring up government finances severely strained by Russia’s invasion and leveraging even more support by reassuring allies that Ukraine is pursuing strong economic policies and fighting corruption, the Associated Press reported.