Lower energy and mining costs pushed the Czech industrial producer price index down by 0.3% y/y in April 2014, slightly softer than the 0.8% decline registered in March, data from the statistics office showed. The reading was in line with market expectations.

Manufacturing producer charges, which have the strongest weight in the index, increased by 1.6% y/y in April, speeding up from 1% the month before due to a faster growth in food prices and rising coke and refined petroleum products as well as chemicals, transport equipment, wood and metal products.

Prices of electricity, gas, steam and air conditioning declined by 8.6% y/y in April, following an 8.8% drop in March, while water supply charges grew by 3.4% for the fourth straight month. Mining and quarrying continued to fall deepening their annual decline to 4.1% in April from 4% the month before.

In monthly terms, industrial producer prices in the country stayed unchanged in April after edging down by 0.2% in March.

Agricultural producer prices fell for the ninth consecutive month in April going down by 2.8% y/y and softening from a 4.2% decline in the previous month. The decline came as crop prices shrank by 10.2%, while the growth in animal products prices eased to 7.8% from to 8.2% in March. On a monthly basis, agricultural prices edged down by 0.1%, following a 0.8% hike in March.

Construction work prices ticked higher by 0.1% on the month and by 0.4% on the year in April, whereas prices of market services grew by 0.4% m/m but dropp by .05% y/y.

The PPI inflation in the Czech Republic eased to 0.8% in 2013 from 2.1% in 2012. Data in the first months of the year indicates that the consumer price inflation, which stayed at more than a four-year low of 0.1% in April will remain muted in the following months. The Czech central bank has said that the threat of deflation has been averted thanks to the easing of the monetary conditions via the forex interventions. Inflation should return to the bank’s 2% target at the end of the year.