Should we be happy? Hungarian inflation below 8%

Consumer prices in Hungary were 7.9 percent higher in November than in the same month a year earlier, the Central Statistical Office (KSH) said on Friday.

Month on Month, prices were flat, though the price of vehicle fuels fell by 3.6 percent.

Food prices rose by 7.1 percent, slowing from a 10.4 percent increase in the previous month. Household energy prices fell by 18.1 percent, albeit from a high base. Gas prices were 36.2 percent lower and electricity prices declined by 3.5 percent.

Prices in the category of goods that includes vehicle fuel rose by 14 percent. Motor fuel prices increased by 25.4 percent.

Harmonised CPI, calculated for better comparison with other European Union member states, was 7.7 percent.

Core inflation, which excludes volatile fuel and food prices, was 9.1 percent.

Commenting on the data, Marton Nagy, the economic development minister, said the government had fulfilled its commitment to push inflation into single digits by October, two months ahead of year-end as originally expected. Inflation, he said, fell below 8 percent in November, helping families and the economy.

The minister said in a statement that the disinflationary trend indicated the efficacy of the government’s targeted measures.

To further curb price increases, the government is extending mandatory price caps on basic foods until July 1, he said. The price of basic foodstuffs will be further monitored, with the number of monitored goods expected to grow from 62 to 80 to include lactose and gluten free goods, beef and duck, he said.

Meanwhile, other indicators, he said, showed that Hungary’s economy may return to its earlier growth path next year. Economic growth in the third quarter was one of the fastest in Europe, and the purchase value of real wages has also started to grow, he said.

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