10% Inflation: How to Protect Your Savings — Banker

In September, annual inflation in Ukraine accelerated to 10%, up from 8.1% in August, while consumer prices increased by 2.1% over the month. This means that savings that generate no income are losing value, gradually reducing their purchasing power.

This was discussed in a new podcast on the Finance.ua YouTube channel by Serhii Mamedov, Vice President of the Association of Ukrainian Banks and Chairperson of the Management Board of GLOBUS BANK.

According to the banker, annual inflation of 10% means that the overall level of consumer prices in September 2026 was 10% higher than in September last year. Accordingly, a hypothetical basket of goods and services that cost UAH 1,000 a year ago would now cost approximately UAH 1,100.

Monthly inflation, meanwhile, reflects changes in prices over a single month. In September, it stood at 2.1%, compared with just 0.1% in August.

Serhii Mamedov also drew particular attention to the difference between official inflation figures and people’s personal perceptions.

In particular, egg prices increased by 43.6% in September, education services by 17.4%, and clothing and footwear by 8.5%. At the same time, vegetables became 2.3% cheaper, while fruit prices fell by 5.7%. According to the banker, official inflation is calculated based on a consumer basket in which different categories of goods and services have different weights.

“Official inflation provides a general picture of economic processes, but each person’s individual expenses may change differently. For example, if a significant share of a family’s budget is spent on food, rising food prices will be particularly noticeable. A family paying for their children’s education, meanwhile, will feel the increase in the cost of educational services more acutely,” the expert explained.

He also highlighted the core inflation rate, which stood at 8.8% year-on-year in September and 2% month-on-month.

Unlike headline inflation, core inflation helps assess more persistent price trends, as its calculation excludes certain goods and services whose prices are significantly influenced by seasonality, administrative decisions or other temporary factors.

“If vegetables become cheaper thanks to a good harvest, this does not necessarily mean that inflationary pressure in the economy has weakened. Industrial goods, rent, transport or household services may become more expensive at the same time. That is why core inflation helps the National Bank understand how persistent price growth is and whether monetary policy needs to be adjusted,” Serhii Mamedov noted.

Among the key factors behind rising prices, the banker cited the consequences of the full-scale war, including Russian attacks, damage to energy infrastructure, and additional costs incurred by businesses for generators, fuel, logistics and security.

According to him, these costs are gradually being reflected in the cost of goods and services. The exchange rate remains an additional factor, as Ukraine imports a significant share of its products, equipment and raw materials.

“The price on a shop shelf is not just the cost of the product itself. It also includes the costs of production, delivery, storage and sale. That is why inflation may remain noticeable even when demand is not driving significant price increases,” the banker explained.

At the same time, the expert emphasised that protecting savings becomes particularly important as inflation accelerates.

Hryvnia deposits remain one of the accessible tools for preserving the value of money. According to Serhii Mamedov, the highest rates on certain deposit programmes can currently reach 17.5% per annum.

Taking into account the 23% tax on deposit interest income, the actual nominal return on such a deposit would be around 13.5% per annum. If inflation remains at 10% over the year, such a return would not only offset the increase in prices but also provide a certain real return. At the same time, the actual result will depend on future inflation and the specific terms of the deposit.

“The main purpose of savings is not only to preserve a certain amount of money, but also to protect its purchasing power as much as possible. Inflation figures should be viewed rationally. They help us understand what is happening in the economy, why prices are changing and how best to plan our personal finances,” Serhii Mamedov concluded.