Hungary Inflation December 2020


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.”

FocusEconomics panelists see inflation averaging 3.0% in 2021, which is up 0.1 percentage points from last month’s projection. For 2022, the panel sees inflation averaging 2.9%.

Author: Massimo Bassetti, Senior Economist

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Hungary Inflation Chart

Hungary Inflation December 20 20 0

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

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