The tighter monetary policy conducted by the National Bank of Ukraine (NBU) allowed counteracting the strengthening of inflationary pressure in February, according to the NBU.
“According to the National Bank’s estimates, monetary conditions are still quite tough to ensure a gradual decline in consumer inflation and its return to the target range in mid-2019,” the NBU report says.
The regulator says that actual inflation in annual terms in February dropped from 14.1 percent to 14 percent and remained slightly higher than the forecast published in the “inflation report” for January 2018. A more significant than expected rise in prices for raw food and fuel led to this, the National Bank explained.
According to its estimates, in general, the current dynamics of consumer inflation and its components testify to preservation of significant inflationary pressure. However, its strengthening in February was counteracted by the strengthening of the hryvnia, which continues in the first half of March and is caused, among other things, by a tight monetary policy, the central bank notes.
The NBU added underlying inflation in February slowed to 9.7 percent in annual terms, slightly exceeding the forecast of the National Bank, but this was primarily due to higher January figures. On a monthly basis, underlying inflation in February (0.6 percent) was in line with the forecast, the regulator said.
