Page 19 - UKRRptJuly18

4.2 Inflation
Prices 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018F
CPI headline (%YoY, 16.6 22.3 12.3 9.1 4.6 -0.2 0.5 24.9 43.3 12.4 13.7 9.4 eop)
CPI headline (%YoY, 12.8 25.3 16 9.4 8 0.6 -0.3 12.1 48.5 14.9 14.5 9.2 average)
PPI (%YoY, eop) 23.2 21.1 15.3 18.8 17.4 0.4 1.7 31.8 25.4 35.7 16.5 9
PPI (%YoY, 20.5 33.6 7.4 21.4 19.9 6 -0.1 17 36.5 20.4 27.2 10.6 average)
Source: ICU, CEIC
4.2.1 CPI dynamics
Ukraine’s consumer prices remained flat in May compared with April , while annual inflation stood at 11.7% year-on-year following 13.2% y/y in April, according to the Ukrstat state statistics service.
Prices for food and soft beverages dropped 0.7% month-on-month (after 1.1% m/m growth in April), mostly due to a seasonal decline in prices for eggs (-9.5% m/m), milk (-2.5% m/m), vegetables (-2.9% m/m) and fruits (-1.1% m/m).
In January-May 2018 the price of bread rose by 18.4%, y/y, according to the State Statistics Service. The price of pasta increased by 9.8%. Inflation in Ukraine in May 2018 in annual terms compared to May 2017 – amounted to 11.7%. Eggs, buckwheat, potatoes and onions saw a reduction in price in May, and in the first two weeks of June meat prices had fallen, Ukrop News 24 reports.
At the top of that, the seasonal change in apparel pushed down prices for clothing and footwear, resulting in a monthly decline of 0.4% m/m (after 2.1% m/m growth in April).
Meanwhile, prices for alcohol and tobacco jumped 1.8% m/m in May (after 1.5% m/m growth in April) as a consequence of excise duty growth by 20-30% in the beginning of 2018. Prices for household durables and transportation increased 0.6% m/m alike, while utility prices inched up 0.1% m/m.
Core inflation stood at 0.2% m/m in May following a 0.6% m/m growth in April, while annual core inflation slowed to 9.3% y/y growth from 9.4% y/y in the previous month.
"The significant deceleration of inflation in May amid increased supply of agricultural produce was widely expected given very favourable weather
19 UKRAINE Country Report July 2018 www.intellinews.com