Ukraine Inflation Rate Slows to 8.2% After Hryvnia Stabilizes
Bloomberg, 2011-02-07 10:20:16.823 GMT by Daryna Krasnolutska and Kateryna Choursina
Ukraine’s annual inflation rate fell for the fourth consecutive month as a stable hryvnia persuaded retailers to keep prices steady. Inflation slowed to 8.2 percent, the lowest level since July, from 9.1 percent the previous month, the statistics committee in Kiev said today in a statement. The median estimate of nine economists surveyed by Bloomberg was 8.8 percent. On the month, consumer prices rose 1 percent.
The Ukrainian currency strengthened 0.5 percent against the dollar last year after weakening as much as 49 percent in the 14 months through August 2009. Price growth slowed to less than 10 percent last year for the first time since 2003. The government forecasts an 8.5 percent rate this year as it asks banks to cut lending rates to bolster the economy.
“Inflation may slow in the short term because of a favorable comparison base, but it will quicken later on recovering domestic demand, hikes in utility tariffs and surging global food prices,” Olena Bilan, chief economist at Kiev-based Dragon Capital, said before the release.
The government increased natural gas prices for households by 50 percent in August and pledged to raise them by another 50 percent in April to meet the International Monetary Fund’s requirements for a $15.2 billion loan. First Deputy Prime Minister Andriy Klyuev said yesterday the Cabinet and IMF will discuss the possibility of putting off the second increase. Producer prices, an early indicator of inflation, rose an annual 18 percent from a year earlier in January, the statistics committee said. Factory-gate prices increased 1.3 percent from December.
--With assistance from Zoya Shilova in Moscow and Harumi Ichikura in London. Editors: Alan Crosby, Willy Morris
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