Ukraine consumer inflation slows to 9.8% in 2018

10 January 2019

Ukraine’s consumer inflation slowed to 0.8% m/m growth in December from from 1.4% m/m in November, mostly owing to declining prices for clothing, footwear and transportation, the State Statistics Service reported on Jan. 9.


Annual inflation slowed to 9.8% yoy from 10.0% yoy in November (and 13.7% in 2017).


Prices for clothing and footwear dropped 2.5% m/m in December (vs. a 0.6% m/m decline in November), while transportation prices declined 1.6% due to lower prices for gasoline.


Food prices grew 1.8% m/m in December (vs. 1.3% m/m growth in November), driven by vegetables (16.5% m/m) and milk (3.2% m/m). At the same time, prices for eggs fell 1.1% m/m and sugar slid 1.0% m/m. In addition, prices for fruits continued to decline, losing 0.6% m/m. Prices for housing and utility services rose 0.7% m/m, slowing from November’s surge of 6.1% m/m.


Core inflation (the consumer basket excluding goods and services with the most volatile prices) slowed to 0.6% m/m growth in December from 1.1% m/m in November. Annual core inflation slowed to 8.7% yoy.


Evgeniya Akhtyrko: The appreciation of the national currency by 0.7% in November and by 0.5% in December fostered the decline of prices for items with a high share of imports, namely clothing, footwear and gasoline. Ultimately, lower-than-expected CPI in December helped to restrain 2018 consumer inflation to the eye-pleasing, single-digit level of 9.8% yoy (vs. 10.1% yoy expected by Ukraine’s central bank).


We expect Ukraine’s consumer inflation will slow further, to 6.7% yoy growth, in 2019.

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