In April 2024, the trend of decreasing inflation on an annual basis in Ukraine temporarily stopped.
According to the report, in April consumer inflation remained at the level of the previous month - 3.2% in annual terms. The actual rates of price growth slightly lagged behind the NBU's forecast.
"The deviation from the forecast was due to the dynamics of some factors of a temporary nature, in particular, a sharp decrease in the prices of raw food products. This is explained both by the influence of warm weather this year and lower business costs due to the decrease in the price of raw materials due to last year's high harvests, and by the reorientation of producers to the domestic market due to restrictions in the west," the commentary notes.
The National Bank predicts that consumer price growth will pick up modestly in the coming months as the effects of last year's big harvests and this year's warm weather wear off, as well as higher business labor costs and rising administrative costs.
Regarding price dynamics, the National Bank of Ukraine notes that raw food prices fell sharply by 6.5% year-on-year. In particular, there was a further decrease in egg prices due to an increase in production and a change in the direction of exports due to border restrictions. Thanks to last year's bumper harvests and limited exports due to the blockade, prices for sugar, flour and cereals also fell.
Warm weather and imports from Turkey contributed to the decrease in the price of tomatoes and cucumbers. Prices of certain vegetables also decreased due to active sale of products from storage. However, the prices of some fruits remained high due to the difficulty of importing due to the blockade of the borders.
Growth in meat prices slowed and pork prices fell due to less pressure on business costs. However, milk prices accelerated slightly due to increased exports of dairy products.
Administratively regulated prices grew at a slower pace - up to 9.5% per annum. The prices of alcoholic beverages continued to decrease, while the prices of tobacco products remained stable. The moratorium on raising tariffs for communal services for the population stopped the growth of administrative inflation.
Fuel prices accelerated to 18.1% per year due to global trends in the oil market and depletion of low-priced petroleum products.
In general, food price growth accelerated to 5.5% per year, while non-food prices decreased more slowly (by 0.6% per year). The cost of services remained stable compared to the previous month.
The growth of consumer prices in Ukraine in April 2024 amounted to 3.2%. This is the lowest value since October 2020, when annual inflation was 2.6%.
In April, the NBU upgraded its inflation forecast to 8.2% for 2024 and predicts a moderate increase in inflationary pressures this year, given the expected exhaustion of the effects of the previous year's large harvests, further recovery in consumption and increased business spending in wartime conditions.
