Inflation in Ukraine erodes savings by 3–5% per year — expert

Money kept on a card or in a wallet loses 3–5% of its purchasing power annually in currency-equivalent terms.

This was stated by HUGS CEO Gleb Kabalnov in an interview with RBC-Ukraine.

According to the expert, inflation in Ukraine cannot be viewed separately from the global economy. Ukrainian prices are shaped by world markets, which is why the rise in the cost of goods and services occurs in sync with global processes.

On average, global inflation amounts to around 3% per year for basic consumption and 4–5% for a more expensive consumer basket. Combined with domestic economic factors, this leads to the gradual erosion of savings.

Kabalnov identifies two basic ways to preserve capital — business and investment. Among investment instruments, he names deposits, government bonds (OVDPs), and stocks as the key options. In terms of complexity and risk, deposits are the simplest option, OVDPs represent the next level, while stocks require deeper knowledge and carry higher risks.

The expert characterizes OVDPs as the primary instrument for preserving capital under Ukrainian conditions: they are straightforward, relatively stable, and require no active management.

Kabalnov classifies gold as a long-term defensive asset rather than an earnings instrument. Its main function is protection against inflation and monetary emission over a 20–30 year horizon. In a classic investment portfolio, the share of gold typically amounts to 5–10% depending on the investor’s strategy.