Food prices add to headline inflation
- Current accounts’ deficits across the region. In September, Czechia, Poland and Serbia posted negative current account balances while in Romania year-to-date number was also negative.
- Flash 3Q24 GDP growth in Romania landed at 0% q/q and 1.1% y/y.
- In Slovakia flash 3Q24 GDP is scheduled at 9 AM CET.
- At 10 AM CET, Poland will publish 3Q24 GDP data, while Slovenia is due 10.30 AM CET.
Economic developments
We will summarize incoming flash estimates of 3Q24 on Friday, while today we focus on inflation numbers. In October, headline inflation increased in all the CEE countries but Slovenia. The energy and food prices are behind such development. In some of the countries such as Czechia or Poland, headline inflation footprints were expected to rise toward the end of 2024. In other such as Slovakia, where we have seen HICP flash estimate but we expect local release to confirm the upward trend, the increase in food prices was particularly high, driving the October’s inflation up and actually, unexpectedly high. In Romania, inflation surprised to the upside as well but it is at the lowest levels in three years. While in Slovakia local factor may play a role, in general, the development of World Food Price Index suggest that food prices are likely to increase and contribute positively to the headline inflation numbers in the short-term. The World Food Price Index rose to 127.4 in October that is the highest in year and a half.
Author
Erste Bank Research Team
Erste Bank
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