"We were able to forestall hyperinflation last year thanks to measures by the government and central bank," First Deputy Prime Minister Viktor Pynzenyk told a news conference Friday.
"December inflation was 28.4 percent, and simultaneously salaries were growing 5 percent faster than inflation, meaning there was no drop in the standard of living," he said.
Pynzenyk added that the shaky karbovanets currency had strengthened against the dollar and the Russian ruble since Dec. 1. The karbovanets firmed 5.7 percent against the dollar and 33.1 percent against the ruble last month, he said.
November inflation rose sharply after the government freed prices for many goods and services.
Government officials have announced plans to bring monthly inflation down to between 1 and 3 percent in the third quarter of 1995.
The economic reform chief went on to say that the government was committed to a 1995 budget deficit of 5 percent of gross domestic product. "The cabinet made a political decision to create a budget with a deficit of no more than 5 percent," he said.
"The draft needs a great deal of work, and we can't expect any more income. The president's position is to look at how much money we have, and draw up spending priorities according to that."
He said cabinet ministers agreed on the budget strategy at a four-hour meeting Thursday.
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