Page 21 - bne IntelliNews Ukraine Country Report May 2017

Prices 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 EFFF
CPI headline 16.6 22.3 12.3 9.1 4.6 -0.2 0.5 24.9 43.3 12.4 8.2 9.4 9.4 (%YoY, eop)
CPI headline 12.8 25.3 16 9.4 8 0.6 -0.3 12.1 48.5 14.9 10.3 9.4 9.4 (%YoY, average)
PPI (%YoY, eop) 23.2 21.1 15.3 18.8 17.4 0.4 1.7 31.8 24 32.3 10.1 9 9
PPI (%YoY, 20.5 33.6 7.4 21.4 19.9 6 -0.1 17 36.5 18 20.8 10.6 9 average)
Source: ICU
4.2.1 CPI dynamics
Ukraine's consumer price index (CPI) sped up to 1.8% m/m growth (15.1% y/y) in March owing to a 5.0% hike in utilities and 10.5% rise in clothing and footwear prices, the State Statistics Service reported on April 7. In the prior month, CPI grew 1.0% m/m (14.2% y/y), mainly on 1.5% m/m food price growth.
Inflation in Ukraine is expected at 11% in 2017 , while the current account balance will remain negative at minus 2.1% of GDP. The unemployment rate in Ukraine in 2017 will be reduced from the current 9% to 8.7%, the IMF forecasts.
A 28.1% m/m surge in electricity rates was the main driver of the utility hike, while food prices grew 1.1% m/m. Transportation price growth slowed to 0.7% m/m (2.0% m/m in February), healthcare price growth eased to 0.4% m/m (0.8% m/m) and education prices chilled to 0.2% m/m (0.4%).
March inflation was much stronger than expected . Concorde Capital projected CPI increasing 1.1% on the back of higher electricity rates, but growth was almost twice as intense. As a rule, rising clothing and footwear prices reflect currency depreciation tendencies; but the hryvnia has already been stable for two months since January and we did not expect the depreciation effect to show up with a two-month lag. The March inflation figures lead Concorde to revise CPI forecast to 9.0% YTD (12.4% y/y) for 2017 from 8.2% YTD (12.0% y/y) estimated previously.
21 RUSSIA Country Report April 2017 www.intellinews.com