National Bank of Ukraine forecasts lower inflation

4 February, 06:42 AM
NBU updates inflation forecasts for 2023 (Photo:NBU Press Center)

NBU updates inflation forecasts for 2023 (Photo:NBU Press Center)

Throughout 2023, inflation rate in Ukraine will slow down to 18.7%, while real GDP will grow only marginally – by 0.3%, primarily due to expected reduction of national security risks, the National Bank of Ukraine (NBU) said in its January report.

The NBU predicts that inflation will slow down in 2023 due to tight monetary policy, a slowdown in global inflation, improved logistics, business adaptation, and weaker consumer demand amid electricity shortages. A more rapid decline in inflation continues to be precluded by the effects of ongoing war in the country.

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“Price pressures will ease in the coming years as security risks decrease, logistics improve and yields increase,” the regulator said.

“As a result, inflation will slow down to 10.4% in 2024, and to 6.7% in 2025.”

According to the NBU, the rise in prices for most goods and services will slow down to single digits within one year. In 2024, a significant decrease in the inflation of raw food products is expected, as well as its stabilization at the level of 3-4% of annual price growth.

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