IN 2018, INFLATION TURNED OUT TO BE LOWER THAN EXPECTED 7 PER CENT

01/14/19 15:13

IN 2018, INFLATION TURNED OUT TO BE LOWER THAN EXPECTED 7 PER CENT

Monetary authorities predict inflation processes deceleration

Tiraspol, January, 14. /Novosti Pridnestrovya/. According to the State Statistics Service, in December, basic commodities went up by an average of 0.8 per cent, thus, in 2018 inflation was 6.97 per cent. The annual composite consumer price index, however, may be adjusted downward: the State Statistics Service did not include the data on fuel cost reduction at the end of December. According to the data of the Pridnestrovian Republican Bank (PRB), before the New Year, prices for fuel and lubricants dropped to October figures. Taking into account this factor, annual inflation will be lower than the range initially predicted by the Central Bank (7–7.5 per cent).   

In 2018, prices for groceries rose most of all - an average of 13 per cent. Prices for vegetables doubled, dairy products, fish products, pasta and cereals, alcoholic beverages and confectionery significantly increased in value. After the November price reduction, eggs, potatoes and vegetables rose in price again in December. 

A significant contribution to the formation of December inflation indicator in the food segment (1.92 per cent) was made by the increase in prices for bread and bakery products (+14.7 per cent). As already noted, this was due to the rise in price of grain (by 30-40 per cent) as a result of an increase in the cost of imported materials - plant protection products, fertilizers, fuel and seed materials.  

The restraining effect on inflation in December was exerted by price dynamics in the non-food group and the service sector. 

In general, inflation in the non-food group and services sector reached 3.25 and 2.34 per cent respectively by the end of the year. In 2018, tobacco products and fuel significantly increased in price, which largely correlates with price dynamics in neighboring countries. There was also an increase in prices for fabrics, building materials and footwear. 

The cost of most public utility services remained unchanged, facilitated by the authorities` social policy. At the same time, hotels, sanatorium and health-improving organizations services rose in price.  

The forecast inflation rate for 2019, according to the PRB Messenger, is about 6 per cent (± 1 percentage point). The monetary authorities expect inflation to decelerate. 

 

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