Croatia's consumer prices continue decline in February

Croatia's consumer prices continue decline in February
By Akin Nazli in Belgrade March 17, 2016

Croatia's consumer prices fell 1.4% y/y in February, deepening from a 0.8% annual decline the previous month, the statistics office said on March 17.

Croatia’s consumer prices have been on a downward trend since the end of 2014 and deflation is likely to continue due to the steady decline in global oil prices. However, the Croatian government expects consumer prices to resume growth this year and forecasts annual inflation of 0.1%.

On a monthly basis, Croatia’s consumer prices fell 0.3% in February, following the 0.7% m/m drop in January.

In February, the largest decline on a monthly basis was recorded in clothing and footwear prices with a 1.9% m/m decrease due to seasonal discounts, followed by a 1.6% m/m decline in transport prices due to a decline in air passenger tickets and fuel prices.

In 2015, consumer prices fell by 0.5% on average.

The statistics office said on February 24 that Croatia's producer prices continued to decline in January, but the drop slightly eased to 3.1% y/y from 4% y/y the previous month. Prices fell on a yearly basis in all sectors. Considering producer prices are a key preliminary indicator for the dynamics of consumer price inflation, the data shows that the CPI deflationary trend registered in the last few months is likely to continue in the near term.