The National Bank of Ukraine (NBU), as expected by the market, has improved its inflation forecast for 2023 to 14.8% (versus 18.7% in the January forecast), the press service of the regulator said on Thursday.

" Inflation will continue to decelerate, including due to lower global energy prices, restrained domestic demand, and the effect of the NBU’s monetary policy. Having considered the combined effect of the above factors and the situation in the energy sector, which was much better than expected, the NBU revised its 2023 inflation forecast, from 18.7% to 14.8%," the NBU said in the press release.

The NBU anticipates that inflation will return to a single-digit level in the next years.

According to the report, easing of price pressures in the coming years will primarily be contributed by a decrease in security risks, which is the main assumption of the NBU forecast.

Under such conditions, inflation expectations are forecast to improve and supply of goods is projected to increase thanks to a recovery in optimal logistical routes and production capacity.

Therefore, the NBU expects inflation to decline to 9.6% in 2024 and 6% in 2025.