Hungary’s consumer price inflation eases to 0.9% y/y in Oct 2013, below expectations.

By bne IntelliNews November 13, 2013

Hungary's annual consumer price growth decelerated to 0.9% in October 2013 from 1.4% in September, the statistics office said. The reading was below market expectations for a 1.3% growth, according to a poll by On a monthly basis, consumer prices in the country decreased by 0.3%, reversing from a 0.5% m/m rise in the previous two months.

The annual growth in food prices eased to 1.1% in October from 1.7% the month before. Prices of alcohol beverages and tobacco products rose by 10.5% y/y, after a 10.9% y/y hike in September. Costs of services advanced by 3.8% y/y in October, faster than the 3.3% y/y increase a month earlier.

By contrast, prices in the group of electricity, gas and other fuels declined by 8.9% y/y, with costs of natural gas, electricity and purchased heat each dropping by 10% y/y. Prices of consumer durable goods extended their downward trend, falling by 1.9% on the year, reflecting continued weak household demand. Prices of clothing and footwear saw a 1.4% y/y fall in October, faster than September’s drop of 0.3% y/y. Prices of motor fuels also decreased by 1.5% y/y.

The Hungarian central bank decided on October 29 to cut the base rate by 20bps to a new historic low of 3.40%. The Monetary Council considers that the bottom of the monetary policy easing could be at 3.00-3.50% and said that further cautious easing of monetary conditions should follow, considering the outlook for inflation and the real economy and taking into account perceptions of the risks associated with the economy. The bank also lowered its forecast for the average annual inflation in 2013 to 2% from 2.1% projected in June.

Consumer prices, % y/y            
  Jan-13 Mar-13 Jul-13 Aug-13 Sep-13 Oct-14
TOTAL  3.7 2.2 1.8 1.3 1.4 0.9
Food 5.8 3.4 2.8 2.7 1.7 1.1
Alcoholic beverages, tobacco 13.1 11.7 8.6 9.1 10.9 10.5
Clothing and Footwear  0.8 -0.4 -0.2 -0.5 -0.3 -1.4
Consumer durable goods -2.1 -2.2 -2.1 -2.2 -1.7 -1.9
Electricity, gas and other fuels 2.4 -8.1 -8.8 -8.7 -8.1 -8.9
Other goods incl. motor fuels and lubricants 1.3 1.5 1.7 0.4 0.0 -1.5
Services  3.1 3.8 3.5 2.9 3.3 3.8
Source: KSH            

Related Articles

Hungarian opposition parties seek explanation for secret admission of asylum seekers

Despite its all-out attacks on the EU’s refugee quotas, Viktor Orban's government secretly gave permission for the admission of the same number of asylum seekers to the country in 2017 as ... more

Hungarian president sets date for parliamentary election

President Janos Ader has set April 8 as the date of Hungary's general election, it was announced on January 11. This is the earliest possible Sunday that the ballot can be held under the law. The ... more

Hungarian government backtracks from collecting fines from opposition parties before election

The Economy Ministry on January 10 asked the tax authority to delay collecting fines from opposition parties imposed by the state auditor ASZ to ensure that their pre-election budgets and campaign ... more