Ukraine consumer inflation stays at 10.2% in August

Annual inflation in Ukraine amounted to 10.2% yoy in
August, staying unchanged from the previous month, the State Statistics Service
reported on Sept. 9. Ukraine’s consumer prices slid 0.2% m/m in August after inching
up 0.1% m/m in July.

Food prices dropped 0.7% m/m in August after declining
0.1% m/m in July. The decline was due to lower prices for fruits and vegetables
(-5.0% m/m and -18.3% m/m, respectively), sunflower oil (-1.0% m/m) and bread
(-0.8% m/m). At the same time, prices for eggs jumped 18.0% m/m, sugar prices
increased 3.6% m/m, and prices for meat grew 0.8%.

Prices for clothing and footwear dropped 3.0% m/m
after sliding 5.2% m/m in July. At the same time, prices for transportation
grew 0.8% m/m in August (after increasing 1.1% in July), driven by higher
prices for fuel and lubricants as well as increased fares for railroad and
automobile passenger transportation. In addition, prices for alcohol and
tobacco increased 0.4% m/m.

Prices for housing and utility services increased up
0.6% m/m (the same growth as in July), driven mostly by a jump in prices for
natural gas and housing maintenance.

Evgeniya Akhtyrko: The decline
of food prices continued in August amid an abundant seasonal supply of fruits
and vegetables. The deflation was also supported by a long-lasting price
decline trend for clothing and footwear supported by a stable exchange rate and
lower demand. Meanwhile, the monthly growth of other consumer inflation
components was close to the growth in the previous month.

We expect consumer inflation to strengthen in
September. Then, it’s likely to cool amid the high comparative base of the
previous year and finish the year at 9.5% YTD (vs. 5.0% YTD in 2020).