As noted in the July National Bank Inflation Report, economic growth will accelerate in the coming years, considering the National Bank’s assumption that security risks will decrease in mid-2024. The NBU forecasts real GDP growth in 2024 of 3.5% and in 2025 of 6.8%.
According to the forecast, consumer inflation will slow to 10.6% in 2023, and core inflation will be below 9%. In 2024, consumer inflation will decrease to 8.5%, and core inflation will drop to 7%. In 2025, it will be 5% ± 1%, and the base rate will be 3%.
The regulator also claims that the increase in military spending due to the war in Ukraine has had a stimulating effect on the GDP of partner countries. Every $1 spent generates $0.79-$0.87 of GDP within one or two years, and the positive effect continues even after five years.