Zero inflation in Ukraine will change for its acceleration to 9.5% next year due to poor harvest and a possible increase in utility rates. This opinion was expressed by Dragon Capital's chief economist Olena Belan.

"Monthly inflation rate in November was record low for this month. The main factor for the low consumer price inflation, as before, was the prices of food, making 54% of the consumer basket," she noted.

According to the expert, in monthly terms, food prices have not changed, while in annual terms their growth was only 2.5%.

"Given the recent dynamics, annual inflation is likely to be 5-5.5% compared with last year, which is the minimum level for the past 10 years," Belan said.

Although the weakening domestic demand will mean lesser pressure on prices in 2012, the economist predicts acceleration of consumer inflation to 9.5% over the previous year due to expected reduction in the yield of major crops, the low base of comparison this year and a possible rise in the tariffs for utility services.

As reported, consumer prices in Ukraine rose in November by only 0.1% compared with the previous month (zero inflation was recorded in October), having slowed to an annualized 5.2% from 5.4% in October.

Producer prices increased by 0.6% compared with the previous month and by 17.3% compared with November 2010.

Ukrinform