KYIV, May 2 – The National Bank of Ukraine (NBU) is observing gradual recovery of the economy after its collapse in the first weeks of the war, Volodymyr Lepushynsky, Director of the NBU's Monetary Policy and Economic Analysis Department, has said.

It's hard for the economy, but it is adapting and working. As the main destructive factor – the Russian occupiers – is eliminated, it is recovering. If in March 10 regions and the city of Kyiv were covered by occupation and active hostilities, which produced 55% of GDP, now it is six regions and 20% of GDP, respectively," he wrote in a column published on the website of Interfax-Ukraine on Friday.

Lepushynsky called the almost halving of the number of enterprises that completely stopped their activity – from 32% to 17% – among the main processes that indicate recovery, although 60% of enterprises are still operating below the pre-war level of workload.

According to the NBU operational surveys, almost a third of enterprises now do not experience problems with a lack of resources at all, and 48% of those surveyed will have enough available resources for more than a month, thus, compared to March, the share of businesses in which stocks have run out has decreased.

Lepushynsky added that metallurgy is starting to work, mechanical engineering is being activated, the food industry is operating at full capacity in relatively calm regions and is being restored in the liberated territories.

According to him, the labor market is gradually recovering, although the number of job seekers is growing faster than the number of vacancies, which leads to lower wages. "Less wages are an unpleasant consequence of the war. However, now it is important that the labor market is functioning and allows businesses to adapt and find workers," the representative of the regulator said.

He also said that the National Bank will continue to pause in the publication of the Inflation Report with a macroeconomic forecast until the economic situation normalizes.

War is almost the only good reason to pause macroeconomic forecasting. Given that additional sources of uncertainty are attached – the duration and consequences of hostilities – it is impossible to make accurate forecasts today," Lepushynsky said.

According to him, to keep an ear to the ground, the NBU has stepped up work on the search and processing of alternative data, as the number of official data has narrowed.

With the current intensity of events, only the most obvious trends that describe the development of the economy should be determined. After the uncertainty is reduced, forecast scenarios will be "strung" on such trends," the director of the NBU's Monetary Policy and Economic Analysis Department wrote. (om/ez)