Inflation dynamics in Ukraine will depend on the war.

According to the Inflation Review of the Ministry of Economy for February 2023, risks of a negative nature still remain high, and the situation might not change in the near future.

The dependence on the influence of “war factors”, the dynamics of the hryvnia exchange rate, prices on the world market, and the amount of financial aid from Ukraine’s international partners leave permanent uncertainty, although the level of uncertainty has now noticeably eased, the document says.

The ministry noted that for the fourth month in a row, inflation has remained in a narrow corridor, 0.7%-0.8% per month, and on an annual basis, it has slowed to 24.9%.

The main factor behind the relatively slow pace is restrained demand and the shift in consumer consumption priorities that have developed during the war. But the decrease in the supply of domestic goods and temporary loss of production capacity remains the primary factor putting inflationary pressure on prices.