Hungary: Inflation inches up in February
March 11, 2014
In February, consumer prices rose 0.1% over the previous month according to the statistical office. The increase, which followed the 0.3% rise recorded in January, was driven by higher prices for food and non-alcoholic beverages as well as for recreation and culture, which more than offset lower prices for housing, water, electricity, gas and other fuels. Annual headline inflation inched up from a flat reading in January to 0.1% in February. Inflation remains well 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, fell 0.1% over the previous month (January: +0.4% month-on-month). Meanwhile, annual core inflation fell from 3.4% in January to 2.8% in February. The Central Bank expects that inflation will end 2014 at 1.9% and increase to 3.0% by the end of 2015. FocusEconomics panelists see 2014 year-end inflation at 2.4%, which is down 0.2 percentage points over last month's projection. Next year, the panel expects inflation to rise to 3.2%.
Author: Dirina Mançellari, Senior Economist