16:30 12.04.2016

Inflation in Ukraine was 2.4 p.p. lower than NBU forecast in Q1, 2016

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Inflation in Ukraine was 2.4 p.p. lower than NBU forecast in Q1, 2016

Consumer inflation in Ukraine in the first quarter of 2016, standing at 1.6%, was 2.4 percentage points lower than the forecast made by the National Bank of Ukraine (NBU), which was estimated at 4%, according to the central bank's website.

"The probability that inflation in 2016 will be lower than 12% forecast by the NBU has grown. However, the majority of factors that influenced inflation in the first quarter, have a short-term nature and with a high probability their impact could change for contrary in subsequent quarters," reads the repot.

The central bank explained that deviation from the forecast is mainly due to the increase in the supply of raw food commodities, as a result prices for this group for the quarter rose by 0.2% (the forecast was 7.6%). In particular, the supply grew on the background of the decline in export opportunities for domestic producers in connection with Russia's restrictions on trade and transit, as well as prohibitions by Israel and the Middle East on imports of eggs from Ukraine. In addition, the offer of certain imported fruit and vegetables grew, especially from Belarus, Turkey.

According to the report, the price war of tobacco producers also led to a more moderate growth of rates (2.1%) compared to the forecast (3.3%).

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