An increase in demand for Ukrainian labor force, both inside the country and abroad, and qualification mismatches on the labor market will impact the growth in wages more than expected. With household income rising, consumer demand will remain robust, which will restrain disinflation.
On the other hand, monetary policy tightening by the NBU, a correction of global commodity prices, the influence of last year’s bumper crops, the easing of the global inflation surge, and vanishing effects of the pandemic will foster a gradual disinflation. The NBU estimates inflation will be quite volatile in 2022 due to base effects.