Ukraine reports 1.4% m/m and 10% y/y inflation in November

Ukraine reports 1.4% m/m and 10% y/y inflation in November
Ukraine CPI was up to 10% year-on-year in November
By bne IntelliNews December 11, 2018

Ukraine’s consumer prices increased 1.4% month-on-month in November, driven mostly by food, housing and utilities prices, the nation's state statistics service Ukrstat reported on December 10.

Annual inflation accelerated to 10% year-on-year from 9.5% y/y in October.

Prices for housing and utilities surged 6.1% m/m, reflecting mostly the government-imposed hike of residential gas rates by 23.5%.

Food prices grew 1.3% m/m (vs. 1.4% m/m growth in October), driven again by vegetables (9.1% m/m), bread (3.3% m/m) and milk (4.5% m/m). At the same time, prices for fruit fell 4.5% m/m and sugar slid 1.7% m/m. In addition, egg prices slid 0.5% m/m.

At the same time, CPI growth was restrained by declining prices for clothing and footwear (0.6% m/m decline in November vs. 2.6% m/m growth in October) and slowed price growth for transportation (0.5 % m/m growth in November vs 3.1% m/m growth in October).

Core inflation (the consumer basket excluding goods and services with the most volatile prices) stood at 1.1% m/m in November vs 1.3% m/m in October.

Annual core inflation sped up to 8.9% y/y from 8.8% y/y in October.

Evgeniya Akhtyrko at Kyiv-based brokerage Concorde Capital wrote in a note on December 11 that the acceleration in consumer inflation was inevitable as November prices were affected by the government's hike in residential gas rates. "Meanwhile, elevated consumer demand is supporting food price growth," she added.

Concorde forecasts 2018 consumer inflation will be close to Ukraine’s central bank latest forecast of 10.1% YTD.