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Hungary: CPI inflation accelerated to 7% y/y in May

Wed, Jun 11 2008, 08:24 GMT
by Orsolya Nyeste

Erste Bank der oesterreichischen Sparkassen AG

Consumer prices rose 1.1% m/m in May, accelerating the 12-month CPI inflation rate to 7% (from 6.6% published for April). Our expectation was 6.7% y/y, while estimations of analyst fluctuated in the range of 6.6-6.8% y/y. Thus, the actual figures came as a big negative surprise.

We did not estimate well the monthly increase in food prices, which was 1.9% in May, instead of our estimation of just 1.5% m/m. Prices of services surpised on the upside as well, rising by 0.6% m/m. Other drivers burdened the May CPI index more or less in line with expectations. The 3.2% m/m increase in fuel prices, and the accounting for the April increase in gas prices (7% on average), both added 0.2-0.2 pps to the headline CPI.

In addition, it’s very negative that the seasonally adjusted core inflation showed 0.5% m/m increase, while the 12 month core rate further accelerated to 5.9%, from its April level of 5.6% y/y. All in all, the figures have significantly increased the likelihood of another rate hike at the June monetary meeting.

Published on  Wed, Jun 11 2008, 08:27 GMT

Archive

• Hungary: Industrial output, June 2008
  Published On Wed, Aug 6 2008, 16:50 GMT
• Hungary: Nominal wages
  Published On Thu, Jul 17 2008, 11:01 GMT
• Croatia: June 08 CPI Inflation
  Published On Tue, Jul 15 2008, 13:41 GMT
• Slovakia: June consumer inflation
  Published On Thu, Jul 10 2008, 13:29 GMT
• Slovakia: Conversion rate
  Published On Tue, Jul 8 2008, 12:16 GMT

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