The CNB comments on the October 2004 inflation figures
8.11.2004
October inflation comes in slightly above the CNB´s forecast
According to statistics released today by the Czech Statistical Office, consumer prices
increased by 3.5% year on year in October. Inflation thus remains close to the centre of the CNB´s
target band. By comparison with the CNB´s October forecast, the rise in prices was slightly higher.
However, this deviation was due primarily to food prices, the outlook for which is always
associated with a high degree of uncertainty.
The highest-ever year-on-year growth recorded in October for fuel prices and regulated prices
was entirely in line with the forecast. The main factor underlying the growth in these consumer
basket items is oil prices on world markets in recent months. The CNB´s expectations of a modest
effect of indirect tax changes and adjusted inflation were also confirmed.
The largest deviation from the forecast was recorded for food prices, whose annual growth did
slow again, but to a lesser extent than forecasted. However, transitory swings in food prices from
the forecast take place in both directions practically all the time, and the current deviation does
not indicate any major turning point in inflation as compared to the October forecast.
Tomáš Holub
Executive Director, CNB Monetary and Statistics Department
The CNB comments on the October 2004 inflation figures
October inflation comes in slightly above the CNB´s forecast
According to statistics released today by the Czech Statistical Office, consumer prices increased by 3.5% year on year in October. Inflation thus remains close to the centre of the CNB´s target band. By comparison with the CNB´s October forecast, the rise in prices was slightly higher. However, this deviation was due primarily to food prices, the outlook for which is always associated with a high degree of uncertainty.
The highest-ever year-on-year growth recorded in October for fuel prices and regulated prices was entirely in line with the forecast. The main factor underlying the growth in these consumer basket items is oil prices on world markets in recent months. The CNB´s expectations of a modest effect of indirect tax changes and adjusted inflation were also confirmed.
The largest deviation from the forecast was recorded for food prices, whose annual growth did slow again, but to a lesser extent than forecasted. However, transitory swings in food prices from the forecast take place in both directions practically all the time, and the current deviation does not indicate any major turning point in inflation as compared to the October forecast.
Tomáš Holub
Executive Director, CNB Monetary and Statistics Department