Bulgaria: Inflation jumps in February on higher food prices
March 15, 2011
In February, consumer prices rose 1.23% over the previous month, which was above the 0.64% increase recorded in January. The higher reading mainly reflected price increases for food and non-alcoholic beverages (+3.05% month-on-month) as well as for transport (+1.20% mom). The recent hikes in food and transport prices have triggered public protests and the government pledged to set up a special body that will monitor food prices to control speculation, including a system that will enable consumers to track food prices from producer to retail stage. Owing to the pronounced price increase, annual inflation jumped from 4.5% in January to 5.2%, well above market expectations, which had inflation remaining at 4.5%. Annual average inflation rose from 2.8% in January to 3.1% in February. Meanwhile, at its latest policy meeting on 28 February, the Central Bank set the base interest rate at 0.18%, down marginally from the previous 0.19%. The government expects inflation to average 3.6% this year.