The terrorist act of the Russians complicated the work of a number of businesses and caused a partial loss of crops, especially vegetables.
The weakening of the Kakhovskaya HPP by Russian aggressors will increase inflation this year by 0.3%. This was announced by the National Bank of Ukraine on Thursday, June 15.
“The negative consequences for prices are the weakening of the Kakhovskaya hydroelectric power station by the Russian invaders. According to the first estimates of the NBU, this terrorist attack will cause an additional contribution to the current inflation at the level of about 0.3% due to complications in the work of a number of enterprises and partial loss of crops, especially vegetables,” – said the message.
In addition, the slowdown in the further decrease in consumer prices will be affected by the effect of the comparison base, which contributed to a significant decrease in inflation in the first half of the year, but will gradually wear off, as well as the increase on individual tariffs for housing and communal services and the announced return of pre-war taxation levels in the fuel market.
According to the NBU, in May inflation slowed to 15.3% yoy due to the effect of the base of comparison, adequate supply of food and fuel, strengthening of the Hryvnia cash exchange rate and improvement of inflation and exchange rate expectations.
The National Bank acknowledged that despite the slowdown in headline inflation, core inflationary pressure remains high, in particular, core inflation in May only fell to 15.6% year-on-year, which is in line with the NBU’s forecast and indicates further transfer of costs incurred by war-related businesses, to the prices of goods and services.
The NBU states that the main risk for inflationary dynamics and economic development is the longer term, as well as the unpredictable nature and intensity of a full-scale war.
There are also risks of further destruction by the aggressor of critical infrastructure, including energy, the emergence of additional budget needs and significant quasi-fiscal deficits, especially in the energy sector, complications or termination of the grain corridor, as well as also the additional extension. of restrictions on the import of Ukrainian food by some European countries.
On the contrary, the rapid implementation of the project to restore Ukraine, together with European integration reforms, can significantly accelerate economic growth and at the same time contribute to an early slowdown of inflation, notes the National Bank.
Recall that in May, the State Statistics Service recorded an increase in monthly inflation. At the same time, food prices rose by 19.7% over the year. Eggs increased the most – by 124.9% and vegetables – 28.1%.
And in April, the NBU was revised for better forecasts for inflation, GDP and international reserves of Ukraine.
Source: korrespondent
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