Ukraine’s inflation, Europe’s highest, accelerated in March for the 14th consecutive month to the annual highest at least since 2006 on the back of the weaker hryvnia, according to the state statistics office.
Inflation was 45.8 percent percent compared with a year earlier, driven by prices for fuels, natural gas and imported food, the office said in a statement on its website. That’s higher than the median estimate of 35 percent from five economists surveyed by Bloomberg. Consumer prices rose 10.8 percent in March from the previous month.
The central bank raised its key discount rate to 30 percent on March 4 to arrest the hryvnia’s decline as a military conflict in Ukraine’s easternmost regions hammers the economy. The regulator’s monetary policy committee recommended that the management board keep the rate unchanged amid “strong inflationary and devaluationary expectations.”
The hryvnia, the world’s worst performer against the dollar, depreciating about 33 percent this year. Food prices have climbed 53.4 percent, according to statistics data.
The National Bank of Ukraine sees inflation peaking in July on the back of increases in utility tariffs and the hryvnia’s slide. Inflation will probably ease in the second half of the year and reach about 30 percent in 2015, according to the central bank.
Producer prices, an early indicator of inflation, rose 51.7 percent in March from a year earlier. They climbed 10.5 percent from the previous month, according to the data.