Inflation in early 2023 is slowing down faster than the National Bank expected, but remains high.
The National Bank predicts that inflation in Ukraine will slow down in 2023. This will be facilitated by several factors plus the measures of the NBU, the press service of the regulator reports.
So, according to the head of the NBU, Andriy Pyshny, in February 2023, the inflation rate dropped to 24.9%. The decline in inflation began earlier and is happening faster than the NBU predicted. This was facilitated, in particular, by factors such as:
increased supply of food and fuel; rapid recovery of the energy system after Russian attacks; weaker consumer demand.
The growth of consumer prices is largely restrained by fixing the official hryvnia exchange rate and tariffs for housing and communal services.
“The complete cessation of emission financing of the budget from the beginning of the year also had a positive effect,” Andrei Pyshny added.
At the same time, the NBU assumes that the factors holding back inflation may turn out to be short-term. Nevertheless, it is noted that inflation, nevertheless, will decrease in 2023, although it will remain high.
“Inflation will continue to decline, including due to the National Bank’s measures to increase the attractiveness of hryvnia assets and maintain exchange rate stability,” the head of the National Bank stressed.
However, inflation is still high and pressure from business spending is significant.
Recall that Focus tells in more detail about prices in Ukraine and forecasts for inflation in 2023 in its new review “A kilo of onions is like a dozen eggs. Prices in Ukraine continue to grow, but there is good news.”
Meanwhile, the Ministry of Economy published an Inflation Report on March 3, 2023, which predicts that inflationary factors will intensify in wartime conditions. It is noted that the significant destruction of infrastructure facilities, the closure of enterprises, as well as the constant Russian terror, primarily of the civilian population, provoked an imbalance in the economy.
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