Industrial inflation in Ukraine grows by 14% in one month marking a 30-year record
The producer price index (PPI) of industrial products in Ukraine increased by 14% in June compared to May, the State Statistics Service reported.
According to the calculations of analyst Oleksiy Blinov from Forbes, such industrial inflation has not been observed in Ukraine for 30 years. The last time higher rates were only during the hyperinflation of 1992-1995.
The main reason for the sharp increase in the index is the increase in the price of electricity for businesses in June.
In annual terms (June 2024 to June 2023), the growth of the producer price index of industrial products accelerated to 26.7%.
In particular, in the energy industry, the annual industrial inflation index reached 48.1%, in the extractive industry – 10.8%, in the processing industry – 7.2%.
At the beginning of 2022, when the change in the PPI exceeded 62% year-on-year, the National Bank, referring to its own calculations, stated that the impact of industrial inflation on consumer inflation in Ukraine is weak. A 10% increase in the PPI causes about a 1% increase in the consumer price index.
At the beginning of the summer, consumer inflation also accelerated sharply in Ukraine. In monthly terms, it increased almost fourfold – from 0.6% in May to 2.2% in June, in annual terms – from 3.3% to 4.8%.
The central bank predicts the acceleration of inflation in the coming months and its departure from the target range (5% +/- 1 percentage point) by the end of the year.