Central Bank: Annual inflation rate amounted to 11% in May

According to the results of May, the annual inflation rate amounted to 11% and is within the forecast trajectory, the CB reported.

At the same time, the annual growth in prices for non-food products amounted to 10.3%, and prices for services - 6.2%, which is lower than general inflation. The price level in the food group takes on the character of growth in accordance with prices in foreign markets.

At the end of May, core inflation reached 10.4% year on year. The contribution of core inflation to headline inflation slightly decreased compared to the corresponding period last year and amounted to 7.8 percentage points.

“It should be noted that while the seasonal decline in prices in the vegetable and fruit group slows down the overall inflation, growth is observed in some segments of the main food and non-food products. The emerging inflationary processes are more related to supply factors, reflecting the negative impact of the current geopolitical situation in the region on the supply of goods and transport and logistics processes,” the report reads.

In addition, if in April of this year there was a decrease in inflationary expectations among the population and business for the next 12 months, then in May, there was an increase against the background of the expected effect from changes in regulated prices.

The inflation forecast for the end of the current year was left unchanged at the level of 12-14%. This forecast takes into account both a further decline in prices for fruits and vegetables in the summer months and a smaller effect from the pass-through of the exchange rate into prices against the background of the strengthening of the national currency, as well as the expected liberalization of tariffs.

In order to stabilize prices, the government is taking measures to increase the supply of products in the domestic consumer market, overcome logistical difficulties, as well as meet the demand for basic consumer goods through alternative sources of imports.