Slovakia's annual producer price inflation eases to 2.3% in Oct 2012.

By bne IntelliNews November 29, 2012

Slovakias annual industrial producer price inflation eased in October to 2.3% from Septembers 2.5% after growing for three consecutive months, data from the statistics office showed. Industrial producer prices on the domestic market rose 4.2% y/y, slowing down from a 4.4% annual growth a month earlier. The industrial producer price inflation was pushed up by a 16.6% jump in the prices of coke and refined petroleum products, following a 17.8% surge in the previous month. Export producer prices grew 1.3% after increasing 1.2% in September. On a monthly basis, producer prices edged 0.1% lower in October after a 0.5% growth in September. On the domestic market, prices increased 0.3% m/m after a 0.4% rise in the previous month, while export prices fell 0.3% after climbing 0.6% in September. Agricultural producer prices jumped 13.5% y/y in October, following a 7.7% growth in September, as crops prices surged 19.2% following an 11.2% rise in September. The producer prices of animal products rose 2.5% following a 1.2% growth in September. Prices of construction works rose 1% y/y last month and prices of construction materials and components increased by 0.9%. IntelliNews comment: Producer prices are a key preliminary indicator for the dynamics in consumer price inflation in the following month. The inflation dynamics in crops prices shows that the drought in North America, which boosted the global prices of wheat and corn by about 35% in June, is increasingly affecting Slovak prices. Slovakias finance ministry revised in September its inflation outlook for 2012 and 2013 to 3.7% (from 3.5%) and 3.1% (from 2.5%), respectively, mainly due to a higher-than-expected growth in food prices. It said that the growth in global food prices would affect Slovakias consumer prices in the fourth quarter of this year and will transfer also in the first months of next year. According to local bank analysts, the growth in food prices, which reached 4.8% y/y in August, would speed up to over 7% by year-end and would continue accelerating at the beginning of 2013 as a result of a delayed effect of the drought. The October producer price inflation data indicates that consumer price inflation could ease slightly in November from its October levels of 0.3% m/m and 3.8% y/y.

y/y change	Oct-12	Sept-12	Jan-Oct-12	2011
INDUSTRIAL PRODUCER PRICES (total)	2.3%	2.5%	2.0%	4.4%
INDUSTRIAL PRODUCER PRICES (domestic)	4.2%	4.4%	3.8%	2.7%
Mining	3.4%	4.8%	5.6%	5.0%
Manufacturing	2.4%	1.7%	1.3%	4.1%
--food, beverages and tobacco	2.6%	1.4%	1.8%	5.4%
--textiles, apparel, leather and related products	0.3%	0.9%	1.3%	4.0%
--wood and paper products, printing	-3.3%	-3.1%	-3.3%	1.0%
--coke and refined petroleum products	16.6%	17.8%	11.2%	30.1%
--chemicals and chemical products	4.8%	3.3%	2.9%	10.9%
--pharmaceutical products and preparation	-0.2%	-0.2%	4.3%	10.1%
--rubber, plastics and other non-metallic mineral products	-0.6%	-0.4%	0.4%	1.0%
--basic and fabricated metal products, except machinery and equipment	-3.1%	-3.4%	-1.5%	3.8%
--computer, electronics and optical products	0.4%	-0.6%	-1.0%	0.2%
--electrical equipment	1.5%	0.9%	0.3%	1.6%
--machinery and equipment	2.0%	2.6%	2.4%	0.1%
--transport equipment	-1.8%	-4.3%	-4.4%	-2.8%
--other manufacturing, repair and installation of machinery and equipment	9.3%	9.3%	5.3%	3.0%
Electricity, gas, steam and air conditioning supply	6.4%	7.7%	7.3%	0.8%
Water supply, sewerage, waste management and remediation	6.1%	6.2%	4.8%	5.2%
INDUSTRIAL PRODUCER PRICES (export)	1.3%	1.2%	0.8%	5.7%

AGRICULTURAL PRODUCER PRICES	13.5%	7.7%	3.9%	16.7%
--Crop products	19.2%	11.2%	3.8%	22.0%
--Animal products	2.5%	1.2%	3.8%	10.8%

CONSTRUCTION WORK PRICES	1.0%	0.7%	0.6%	1.2%
CONSTRUCTION MATERIALS PRICES	0.9%	0.4%	1.5%	1.8%

Slovakia's annual producer price inflation eases to 2.3% in Oct 2012.

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