Page 26 - UKRRptFeb21

Alfa-Bank Ukraine’s head of research, predicts on Facebook that Ukraine’s annual inflation rate will rise to 6% this month and 7% in February.
4.2.1​ CPI dynamics
Ukraine’s consumer prices increased 0.9% m/m in December ​after jumping 1.3% m/m in November, mostly due to increases in prices for food, transportation, as well as alcohol and tobacco, the State Statistics Service reported on January 11.
Annual inflation sped up to 5.0% y/y from 3.8% y/y in November (and 4.1% ytd in 2019).
Food prices advanced 1.7% m/m in December (after increasing 1.3% m/m in November). Prices grew the most for eggs (16.1% m/m), vegetables (8.3% m/m), and sugar (6.0%). Prices for alcohol and tobacco added 0.5% m/m in December.
Prices for transportation increased 0.7% m/m in December, mostly due to increased prices for gasoline and lubricants (+2.5% m/m)
At the same time, prices for clothing and footwear dropped 4.6% m/m (after falling 2.5% m/m in November). Prices for housing inched up 0.1% m/m (vs. a 8.0% m/m surge in November).
Consumer inflation is gaining momentum in Ukraine, with demand being driven by the fast growth of real income, specifically wages. At the same time, high month-to-month fluctuations in prices for certain food items are typical for Ukrainian consumer market. And this might intensify the inflation expectations of individuals, feeding this self-sustaining cycle.
Consumer inflation is likely to speed up further in January, as the hike of the minimum wage to UAH6,000 per month will serve as an additional factor for maintaining already high consumer demand. In addition, the government plans to hike some utility tariffs amid growing prices for energy resources.
26​ UKRAINE Country Report​ February 2021 ​ ​www.intellinews.com