Ukraine CPI falls 0.2% m/m in June
11 July 2016
Ukraine’s consumer prices fell 0.2% m/m (+6.9% yoy) in June from a 0.1% m/m (7.5% yoy) rise in the prior month, according to state statistics released on July 8. The main factor was falling food prices (-0.6% m/m), followed by cooling prices for clothing and footwear (-2.0% m/m vs. flat m/m in May), transportation (+1.2% m/m vs. +2.8% m/m in May) and healthcare (+0.3% m/m vs. +0.6% m/m in May). The only accelerating prices were in education (+1.1% vs. +0.7% m/m in May) and utilities (+0.1% vs. -2.0% m/m in May).
In 1H16, CPI increased 4.9% YTD.
Alexander Paraschiy: The strengthening hryvnia and a seasonal decrease in food prices (vegetable prices fell 9.2% m/m) stood behind June deflation. This tendency is in line with our forecast and we are keeping our initial CPI forecast unchanged at 10.5% YTD (+14.5% yoy) for 2016. For 2H16, we expect some acceleration in consumer prices on the back of a nearly 28% increase in electricity rates from September and doubled heating rates from July 1 (with most effect from it will be visible in October).
