Czech Republic: Inflation bounces back in August
September 10, 2012
In August, consumer prices fell 0.1% over the previous month, which followed a decline of the same magnitude in July. The monthly drop was the result of lower prices for food and non-alcoholic beverages, clothing and footwear, as well as for transport. Despite the monthly drop, annual headline inflation rose from 3.1% in July to 3.3% in August, which matched market expectations, but fell short of the Central Bank's estimate that had inflation rising to 3.4%. At the current level, inflation remains above the Central Bank's target of 2.0% (with a tolerance margin of plus/minus 1.0 percentage points). The Czech National Bank expects inflation to fall to 3.0% by the end of this year. For 2013, the Bank predicts inflation to fall further to 2.3%.