According to the European Bank for Reconstruction and Development, the growth forecast is at 1% this year and 3% in 2024, assuming the war continues throughout this period at the same intensity as at the start of 2023.
The forecast notes that after an unprecedented 29.1% drop in GDP in 2022, output in real terms has stabilized at around 70% of pre-war levels. According to the EBRD, inflation eased to 21.3% year-on-year in March 2023 and is likely to continue to decline.
It is expected that foreign exchange reserves will remain at an adequate level, supporting the peg of the exchange rate, the bank believes. However, the forecast is vulnerable to high uncertainty and downside risks depending on the dynamics of the war.