Hungary Inflation


Hungary: Consumer prices record unprecedented drop in December

January 14, 2015

In December, consumer prices fell 0.7% over the previous month, which followed the 0.4% drop observed in November. The figure represented the steepest drop on record and reflected falling prices for several categories of the price index, such as food, alcoholic beverages and tobacco as well as electricity, gas and other fuels.

In annual terms, consumer prices dropped 0.9% in December, following the 0.7% drop observed in the previous month and representing the steepest decline on record. As a consequence, inflation fell further below the Central Bank’s target of 3.0%, with a tolerance margin of plus/minus 1.0%. Core consumer prices, which exclude volatile items such as fresh food and fuel, dropped 0.2% over the previous month, contrasting November’s 0.2% price increase. Meanwhile, annual core inflation edged down from 1.2% in November to 0.9% in December.

In its December inflation report, the Central Bank projects that inflation will be 0.9% on average in 2015. For 2016, it sees inflation averaging 2.9%. FocusEconomics panelists see inflation averaging 1.5% in 2015, which is down 0.5 percentage points from last month’s projection. For 2016, the panel expects inflation to rise to 2.7%.

Author: Teresa Kersting, Economist

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Hungary Inflation Chart

Hungary Inflation December 2014 0

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

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