Consumer prices in Ukraine by the end of September fell to 7.1%, down from 8.6% at the end of August and a significant drop from July's 11.3% as inflation begins to cool, Ukrstat reported on October 9. (chart)

On a monthly basis, inflation saw a moderate increase of 0.5% in September, marking a turnaround from the previous month's decline of 1.4% in August and 0.6% in July, as reported by the State Statistics Service.

Comparing the current figures to the same period in the previous year, September 2022 recorded an inflation rate of 1.9% on a monthly basis.

Inflation this year has been falling further and faster than the National Bank of Ukraine (NBU) expected in its annual outlook, allowing the regulator to cut rates sooner than expected.  Its key discount rate has been cut to 20% and the NBU said in September it could be lowered to 18% by the end of the year and inflation could fall to 13.8% in the recently released Ukraine’s 2024 budget  plan.

The Ukrstat also tracked underlying inflation, which stood at 0.9% in September, following two months of remaining steady at zero. In September 2022, underlying inflation was higher at 2.4%. In annual terms, by the close of September 2023, it had decreased to 8.4%, showing a notable decline from August's 10% and July's 12.3%.

Year-to-date, inflation in Ukraine has reached 3%, while underlying inflation stands at 4.1%, according to the service's clarification.

In response to these developments, the National Bank of Ukraine revised its inflation forecast for 2023, initially at 14.8%, down to 10.6% in July. Recent announcements suggest further downward revisions are being considered.

Comparing to the previous year, 2022 saw inflation rise to 26.6% from 10% in 2021, while underlying inflation surged to 22.6% from 7.9%.