Although the effects of these individual factors are insignificant, their combined impact on inflation expectations could be substantial, on the back of greater uncertainty arising from presidential and parliamentary elections. On the other hand, a more noticeable strengthening in the hryvnia exchange rate than is envisaged in the current forecast, is helping curb inflation.
That said, the risks to inflation decreasing mentioned by the NBU in its January macroeconomic forecast continue to persist. What will the NBU’s monetary policy stance be in future?