Czech Republic: Inflation ticks down in May
Consumer prices rose 0.17% from the previous month in May, following April’s 0.53% jump. Looking at the details of the release, May’s result mainly reflected higher prices for automotive fuels and lubricants and motor cars.
Meanwhile, inflation declined to 2.9% in May from April’s 3.1%, which had marked the highest reading since September 2020, and moving marginally below the higher bound of the Central Bank’s 1.0%–3.0% tolerance range. Lastly, annual average inflation was stable at April’s 2.8% in May.
Commenting on the release, Jakub Seidler, Czech Republic chief economist at ING, stated:
“While the CPI was driven higher by technical and supply factors, it is still above the central bank’s tolerance band and likely increases the chances for an end-of-June hike, in our view. It is clear now that the CNB meeting in June or August will deliver the first CNB tightening.”