Hungary: Inflation continues to rise in July
August 14, 2012
In July, consumer prices decreased 0.1% over the previous month, which contrasted the 0.1% rise seen in June but still was above market expectations that had prices falling 0.2%. The monthly price drop was broad-based, with prices for most categories decreasing over the previous month, particularly for clothing and footwear. Annual headline inflation rose from 5.6% in June to 5.8% in July, which came in above market expectations that had inflation remaining at 5.6%. Consequently, inflation continued to move further above the Central Bank's inflation target of 3.0% with a 1.0 percentage point tolerance margin. Meanwhile, the seasonally adjusted core inflation index, which excludes volatile items such as food and fuel, added 0.4% over the previous month, pushing annual core inflation to 5.1% in July. In its latest inflation report from June, the Central Bank projects inflation to end the year at 4.8% before gradually falling to 3.5% by the end of 2013.