Hungary's consumer prices pick up 0.2% y/y in August 2014, in line with expectations

By bne IntelliNews September 12, 2014

Hungary's consumer prices increased by 0.2% y/y in August 2014, accelerating slightly from a 0.1% y/y rise in the previous month, data by the statistics office showed. The reading was in line with market expectations since analysts polled by expected a growth of between 0.2-0.3% y/y in the month.

On a monthly basis, consumer prices in the country declined by 0.2% in August, reversing from a 0.2% rise in July.

Food prices edged down by 0.1% y/y in August, softening from a 0.4% drop the month before. Similarly, prices of consumer durable goods dropped by 0.2% y/y, following a 0.4% fall in July. The decline, although at a slower pace, signals for continued weak household demand. Prices of clothing and footwear extended their downward trend, falling by 0.3% on the year in August. Cost of motor fuels fell by 0.2% y/y as well.

On the other hand, prices of alcohol beverages and tobacco products rose by 6.4% y/y in August, slightly slower than in July when they grew by 7.1% y/y. Costs of services advanced by 2.7% y/y.

The government's decision to cut household gas prices by 6.5% as of April 1 continued to determine the deflationary effect. Prices of electricity, gas and other fuels fell 12% y/y in August, declining at the same pace as in the previous month.

Consumer prices, % y/y              
  Dec-13 Jan-14 Apr-14 May-14 June-14 Jul-14 Aug-14
TOTAL  0.4 0.0 -0.1 -0.1 -0.3 0.1 0.2
Food 0.1 -0.2 -0.5 -0.8 -1.3 -0.4 -0.1
Alcoholic beverages, tobacco 12.0 10.5 7.3 7.8 7.7 7.3 6.4
Clothing and Footwear  -1.1 -0.7 -1.4 -1.0 -0.9 -1.0 -0.3
Consumer durable goods -1.6 -0.8 -0.5 -0.6 -0.8 -0.4 -0.2
Electricity, gas and other fuels -17.7 -16.9 -10.3 -12.5 -12.3 -12.0 -12.0
Other goods incl. motor fuels and lubricants 0.9 -0.6 -0.6 0.8 0.8 0.9 -0.2
Services  3.7 3.1 1.6 1.4 1.3 1.8 2.7
Source: KSH              

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