Czech Republic: Inflation remains stable in April
May 10, 2013
In April, consumer prices rose 0.1% over the previous month, which followed a monthly increase of the same magnitude in March. The subdued figure mainly reflects higher prices for clothing and footwear as well as for alcoholic beverages and tobacco, which were partially offset by lower prices for food and non-alcoholic beverages.
Despite the monthly increase, annual inflation remained stable at March's 1.7%, which was in line with market expectations, but came in a notch below the Central Bank's estimate of 1.8%. In addition, the reading remains within 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 reach 2.3% by the end of this year before moderating to 1.8% by the end of 2014. FocusEconomics Consensus Forecast panellists share the Bank's assessment and also expect inflation to reach 2.3% by the end of this year, which is down 0.1 percentage points from last month's Consensus. For 2014, panellists expect inflation to fall to 1.8%.
Author: Ricardo Aceves, Senior Economist