Ukraine’s Annual Inflation Sees Surprise Rise At 45.8%

Ukraine’s annual inflation sees surprise rise at 45.8% (PressTV, April 6, 2015):

Official data show the annual inflation rate in crisis-hit Ukraine has jumped to 45.8 percent.

The increase follows a steep acceleration of 10.8 percent in March, according to the country’s statistics office.

The eastern European nation, which had been the scene of a year of deadly clashes between its army and pro-Russia forces in the east, had a month-on-month inflation of 5.3 percent in February and 3.1 percent in January 2015.

A fragile deal between the Kiev government and pro-Russians signed in February almost ended the tensions. However, the country is left in the hands of a combination of monetary, budgetary, industrial, banking and energy crises that could make Kiev reliant on outside help for years.

The agreement, brokered in the Belarus city of Minsk, was reached after marathon talks between the leaders of France, Germany, Russia and Ukraine. It came into force on February 15.

Ukraine’s vital heavy industry in the eastern part of the country has been particularly damaged in fierce fighting, while production has fallen by a fifth.

Moreover, as many foreign investors preferred to leave Ukraine amid the uncertainty that emerged from the armed conflict, the value of the local currency, the hryvnia, has plummeted by around 50 percent since the beginning of the year.

Last month, the International Monastery Fund (IMF) gave its first USD-5-billion tranche of aid to Kiev. The organization has vowed to provide the Ukrainian government with some USD 17.5 billion in bailout money.

4 thoughts on “Ukraine’s Annual Inflation Sees Surprise Rise At 45.8%

  1. Why is that a surprise?

    As you rightly highlighted, the IMF coughed up a massive loan for Ukraine in the sure knowledge it would never be repaid, but Greece is kicked from pillar to post for non compliance.

    D’oh!

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