GDP growth misses expectations in Q3 with +2.4% y/y amid record-high grain harvest
The state statistics office reported 2.4% y/y GDP growth in Q3. The result is far below expectations. The NBU just a few weeks ago estimated a 4.0% y/y GDP increase for the third quarter. Poor industry performance (near-zero growth through the quarter), as well as sluggish agro production (+7.2% y/y in Q3, we estimate) amid record-high crops, are the main reasons for the disappointing GDP number. We can hardly expect better industry growth amid the approaching tightening of US monetary policy. However, we already know that grain crops will be nearly 25% higher than a year ago. The growth in agro will be reflected totally in Q4, which should underpin overall GDP growth. Provisionally, we estimated GDP to increase by 3.6% y/y in 2021, down from +4.0% projected previously. Our revision of forecasts is coming soon.