National Bank of Ukraine: Inflation to reach 31% by year-end

By the end of 2022, inflation in Ukraine will accelerate and reach 31%, its return to the target of 5% is expected in 2025, Report informs citing UNIAN.

According to the National Bank of Ukraine (NBU) July report, the war led to the disruption of supply chains, a reduction in the supply of certain goods, an increase in business costs, the physical destruction of production facilities and infrastructure, and the temporary occupation of certain territories.

Persistently high energy prices and record inflation levels in partner countries have also added significantly to price pressures in Ukraine.

Inflation is expected to slow down next year thanks to improved inflation expectations, better logistics and a gradual increase in harvests. A decrease in global inflation and a tight monetary policy of the NBU will have an additional disinflationary impact.

At the same time, the inflation slowdown will be held back by the high cost of energy resources and the need to gradually bring energy tariffs for the population to market levels. Taking into account the consequences of the war and the significant contribution from the increase in administrative prices, inflation will decrease to 20.7% in 2023, and to 9.4% in 2024. Its return to the target of 5% is expected in 2025.