Hungary Inflation


Hungary: Consumer prices continue to decline in June

July 11, 2014

In June, consumer prices increased 0.1% over the previous month according to the statistical office. The rise, which contrasted the 0.2% fall recorded in May, reflected that an increase in prices for services as well as for alcoholic beverages and tobacco more than compensated for lower prices for electricity, gas and other fuels, clothing and footwear and foodstuffs.

In June, consumer prices fell 0.3% over the same month last year, which came in below May’s 0.1% drop and marked the largest decline in consumer prices on record. As a consequence, annual inflation stayed below the Central Bank’s target of 3.0% with a tolerance margin of plus/minus 1.0%. The core inflation index, which excludes volatile items such as fresh food and fuel, rose 0.1% over the previous month (May: +0.2 month-on-month). Meanwhile, annual core inflation remained stable at May’s 2.5% in June.

In its June inflation report, the Central Bank projects that inflation will be zero at the end of 2014 and then increase to 2.5% at the end of 2015. FocusEconomics panelists’ projection is not in line with the Central Bank’s forecast as the panel sees 2014 year-end inflation at 1.5%, which is down 0.6 percentage points from last month’s projection. Next year, the panel expects inflation to rise to 2.9%.

Author: Teresa Kersting, Economist

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Hungary Inflation Chart

Hungary Inflation June 2014

Note: Year-on-year and month-on-month variation of consumer price index in %.
Source: Hungarian Central Statistics Office.

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