In April 2012, the consumer price index (hereinafter - the CPI) remained unchanged versus March (seasonally adjusted CPI figure stood at zero), with annual CPI inflation having fallen to 0.6% (the lowest figure recorded in the past 9 years).
The core CPI continued to decline to 4.7% year on year (the core CPI remained unchanged on a month-on-month basis). It was achieved due to the moderate monetary and fiscal policies, which continue to put downward pressure on the aggregate demand (the annual growth rate of monetary aggregates continued to decelerate, the state budget for January-March showed a surplus).
Price increases for deeply processed foodstuffs, being the core CPI component, decelerated to 7.5% over the year, which was driven by secondary effects arising from a drop in prices for raw foods. The narrow core inflation has declined to 1.2% year on year (it has risen by 0.1% on the month).
A downward trend in the non-core CPI, which started in the middle of 2011 (owing to the good harvest), persisted in April. Annual non-core CPI dropped by 4.6%. The non-core CPI declined by 0.1% on the month, contributing 0.0 p. p. to the change in the CPI.
A downward trend in the non-core CPI was triggered by the ongoing decline in raw foods prices, which fell by 9.2% over the past 12 months on account of last year’s good harvest.
Increases in administratively-regulated prices slowed down to 1.5% (in April prices grew by 0.1%), contributing 0.3 p. p. to the CPI (0.0 p. p. on the month).
Fuel prices grew at a faster pace (by 11.9% over the past 12 months and by 5.1% on the month) than other components of the non-core inflation, which was driven by oil price rises in the global commodity markets in the first quarter of 2012.
A slowing in global economic activity continues to exert downward pressure on prices for products of basic export-oriented industries and producer price index (hereinafter - the PPI). The PPI growth slowed down from 21.3% to 6.9% year on year over the past six months. The PPI increased by 3.7% in April, which was driven by a 13.5% rise in prices for production and distribution of electric power, gas, and water (contribution to the PPI – 2.7 p. p.).