Page 20 - UKRRptMay21

than just a bounce after the downfall of the prior year. The output will increase around 4% y/y (vs. a 4.5% y/y decline in 2020).
4.2 Inflation
Ukraine's annual inflation will reach a 1.5-year high of 8% in March 2021,
exceeding the Central Bank's forecast of 7.6%, said a monthly Reuters poll of Ukrainian analysts. Analysts said consumer prices rose due to inflation imported from world commodity markets, notably wheat, corn, sunflower oil and crude oil. Oleksiy Blinov, Alfa-Bank Ukraine’s Head of Research, said: “These changes in external prices are directly and indirectly transmitted to consumer inflation in Ukraine.” The IMF has predicted that Ukraine’s consumer price index will end this year at 7.9%.
The Central Bank revised its 2020 inflation forecast to 8%, from 7%. After inflation hit 8.5% y/y last month, the National Bank of Ukraine now predicts that inflation will peak at 9.6% in the third quarter. It will recede steadily, hitting 5% for 2021, the bank has predicted.
Annual inflation in Ukraine sped up to 8.5% y/y in March from 7.5% y/y in February the State Statistics Service reported on April 9, making a rate hike at this week’s monetary policy meeting likely say analysts.
Ukraine’s consumer prices jumped 1.7% m/m in March after increasing 1.7% m/m in February mostly due to growing prices for food, transportation as well as clothing and footwear.
“Monthly inflation in March was higher than in the three previous years. It looks like unleashed food prices turned the consumer inflation to a self-sustaining
20 UKRAINE Country Report May 2021 www.intellinews.com