Ukraine Suffers Highest Annual Inflation Rate In 14 Years

Ukraine's annual inflation rate reached nearly 25 percent during 2014, the highest rate seen there in 14 years.

Ukraine’s State Statistic Service said on January 6 that consumer price inflation soared to 24.9 percent during 2014 compared to 0.5 percent in 2013.

Major factors driving up inflation included the conflict in the country’s east, which hit major exports such as steel and forced imports of coal and electricity, and the government's decision to raise the domestic price of natural gas.

The falling purchasing power of the hryvnia currency, which lost half of its value in 2014, also contributed to rising prices for food, fuel, and services.

Ukraine's 2015 budget envisages annual inflation of just over 13 percent.

But Central Bank Governor Valeriya Hontareva has said inflation is likely to rise to as much as 18 percent if the government further increases the price of natural gas for home consumption.

Based on reporting by Reuters, Interfax, and TASS