Bloomberg News

Ukrainian Inflation Slows to 5.4% in October on Good Harvest

November 07, 2011

Nov. 7 (Bloomberg) -- Ukrainian inflation slowed for a fourth month in October after high grain and vegetable crops helped ease food prices.

The inflation rate fell to 5.4 percent from 5.9 percent in September, the state statistics committee in the capital, Kiev, said today on its website. The median estimate of 10 economists in a Bloomberg survey was 6.4 percent. Prices were unchanged from the previous month, when they rose 0.1 percent.

“We expected consumer prices to increase slightly last month, but the data outperformed our expectations,” Olena Bilan, chief economist at Kiev-based Dragon Capital, said by phone. Currency risks moderated in October, while the chances the International Monetary Fund will force Ukraine to raise household prices for natural gas are “very low” amid a possible agreement for cheaper imports from Russia, she added.

Prime Minister Mykola Azarov’s government is aiming to keep year-end inflation below 10 percent. The figure may be less than 9 percent, Valeriy Lytvytskyi, chief adviser to central bank governor Serhiy Arbuzov, said Oct. 4.

Inflation may reach 7 percent to 8 percent by year-end, according to Dragon Capital. Producer prices, an early indicator of inflation, rose 16.3 percent from a year earlier and declined 1.8 percent from September, the statistics committee said.

--With assistance from Zoya Shilova in Moscow and Harumi Ichikura in London. Editors: Andrew Langley, Alan Crosby

To contact the reporters on this story: Kateryna Choursina in Kiev at kchoursina@bloomberg.net; To contact the editor responsible for this story: Claudia Carpenter at ccarpenter2@bloomberg.net


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