The CNB comments on the January 2013 inflation figures
Inflation comes in slightly below the CNB’s forecast in January 2013
According to figures released today, the price level increased by 1.9% year on year in January 2013. Annual headline inflation thus slowed for the fourth consecutive month. Monetary-policy relevant inflation, i.e. inflation adjusted for the first-round effects of changes to indirect taxes, remained unchanged in January, at 1.1%. This means that it is still near the lower boundary of the tolerance band around the CNB’s target.
Annual headline inflation was 0.1 percentage point lower in January than the CNB’s current forecast. The downward deviation from the forecast was due chiefly to lower-than-expected growth in administered prices. The noticeably slower-than-expected growth in these prices was primarily due to the transfer of the still relatively fast rising deregulated rents from administered prices to the category of adjusted inflation excluding fuel prices. The Czech Statistical Office made this transfer owing to the completion of the process of rent deregulation. In addition to this effect, the slower-than-expected rise in administered prices was due to lower growth in housing-related energy prices. By contrast, the annual decline in prices in the adjusted inflation segment was slightly lower than expected by the CNB due to the above-mentioned methodological change, or, after adjustment for this change, the inflation forecast was approximately fulfilled in this component. Food prices rose somewhat faster than forecasted. Fuel prices and the impacts of changes to indirect taxes were in line with the CNB’s expectations.
The published data bear out the message of the CNB’s current forecast. Tax changes, food price growth and gradually falling import price growth are the sources of inflation. By contrast, the domestic economy is dampening inflation. According to the forecast, headline inflation will be close to the CNB’s target this year despite substantial impacts of tax changes, and will fall slightly below the target after these impacts fade away. Monetary-policy relevant inflation will be in the lower half of the tolerance band around the CNB’s target until the end of 2014.
Petr Vojtíšek, Deputy Executive Director, Monetary and Statistics Department
The CNB comments on the January 2013 inflation figures
Inflation comes in slightly below the CNB’s forecast in January 2013
According to figures released today, the price level increased by 1.9% year on year in January 2013. Annual headline inflation thus slowed for the fourth consecutive month. Monetary-policy relevant inflation, i.e. inflation adjusted for the first-round effects of changes to indirect taxes, remained unchanged in January, at 1.1%. This means that it is still near the lower boundary of the tolerance band around the CNB’s target.
Annual headline inflation was 0.1 percentage point lower in January than the CNB’s current forecast. The downward deviation from the forecast was due chiefly to lower-than-expected growth in administered prices. The noticeably slower-than-expected growth in these prices was primarily due to the transfer of the still relatively fast rising deregulated rents from administered prices to the category of adjusted inflation excluding fuel prices. The Czech Statistical Office made this transfer owing to the completion of the process of rent deregulation. In addition to this effect, the slower-than-expected rise in administered prices was due to lower growth in housing-related energy prices. By contrast, the annual decline in prices in the adjusted inflation segment was slightly lower than expected by the CNB due to the above-mentioned methodological change, or, after adjustment for this change, the inflation forecast was approximately fulfilled in this component. Food prices rose somewhat faster than forecasted. Fuel prices and the impacts of changes to indirect taxes were in line with the CNB’s expectations.
The published data bear out the message of the CNB’s current forecast. Tax changes, food price growth and gradually falling import price growth are the sources of inflation. By contrast, the domestic economy is dampening inflation. According to the forecast, headline inflation will be close to the CNB’s target this year despite substantial impacts of tax changes, and will fall slightly below the target after these impacts fade away. Monetary-policy relevant inflation will be in the lower half of the tolerance band around the CNB’s target until the end of 2014.
Petr Vojtíšek, Deputy Executive Director, Monetary and Statistics Department