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fiscal systems and implement all social benefits.
The Ministry of Economy gives a guarded forecast regarding hyperinflation in Ukraine. During the war, the inflation rate in Ukraine accelerated significantly. However, hyperinflation should not be expected, as prices will remain under state control, reported the Ministry of Economy. The consumer price growth rate remains moderate, at 17.4% for the first half of the year. The price dynamics will continue to depend solely on the course of events on the battlefield. The Ministry of Economy identified a significant risk of accelerating inflation due to increased devaluation of the hryvnia resulting from a shortage of foreign currency. It was further provoked by the deterioration of the trade balance against the background of the seaport blockade and the outflow of foreign currency due to the population exodus from the country. However, the Ministry added that Ukraine should not expect extremes in price dynamics, which might lead to extremely high hyperinflationary rates.
4.2.1 CPI dynamics
The annual inflation rate in Ukraine accelerated to 22.2% in July of 2022
from 21.5% in the previous month, the highest since February 2016, as the country endured five months of Russia’s invasion, reports Trading Economics.
Costs accelerated for food and non-alcoholic beverages (28.9% vs 27.7% in June), household items and furnishings (16.2% vs 14.1%), restaurants and hotels (16.4% vs 15.9%), and education (16.1% vs 15.9%). While remaining at high levels, inflation for transportation eased (40.4% vs 42.4%), due to a slower increase for fuel and lubricants (77.7% vs 90.9%). On a monthly basis, consumer prices rose by 0.5%, easing from the 0.6% increase in the prior month
26 UKRAINE Country Report September 2022 www.intellinews.com