Hungary: Inflation stable in December
January 14, 2021
Consumer prices rose 0.30% from the previous month in December, contrasting November's 0.20% drop. December's figure largely reflected higher prices for alcoholic beverages and tobacco.
Inflation remained stable at November’s 2.7% in December. Meanwhile, the trend pointed down, with annual average inflation coming in at 3.3% in December from 3.4% in November. Lastly, core inflation inched up to 4.0% from the previous month's 3.9%.
Commenting on the outlook, Peter Virovacz, senior economist at ING, stated:
“The headline inflation figure is below target and significantly lower than the central bank's implicit forecast. Maybe it would even allow for a dovish shift. However, core inflation is clearly stubbornly hovering around 4%, just at the top of the National Bank of Hungary's inflation tolerance band. Based on all this, we don't see the central bank making any type of move (especially not a rate cut) soon, so the cautious, wait-and-see monetary policy setup remains.”