The CNB comments on the August 2011 inflation figures
Inflation comes in below the CNB forecast in August 2011
According to figures released today, the price level increased by 1.7% year on year in August 2011. Annual headline inflation was thus unchanged from July. The annual rate of monetary-policy relevant inflation, i.e. inflation adjusted for the first-round effects of changes to indirect taxes, was also flat at 1.7% in August and remains slightly below the inflation target.
Annual headline inflation was 0.4 percentage point lower in August 2011 than the CNB’s current forecast. The downward deviation from the forecast was due mainly to food prices as a result of an unexpectedly sharp seasonal fall in fruit and vegetables prices. Lower-than-expected annual growth in regulated prices acted further in the same direction; however, it was due to a slower increase in rents and health care prices in July. Adjusted inflation excluding fuel price was also slightly lower in August than expected by the CNB.
Despite the above deviations, the August inflation data are broadly in line with the message of the CNB forecast. According to this forecast, the inflation pressures from the domestic economy were not significant and commodity and food prices were the main source of inflation in the past period. Headline inflation will be close to the inflation target over the entire forecast horizon. Headline inflation will be slightly above 3% in 2012 owing to an increase in the reduced VAT rate, but will return to the target at the start of 2013.
Tomáš Holub, Executive Director, Monetary and Statistics Department
The CNB comments on the August 2011 inflation figures
Inflation comes in below the CNB forecast in August 2011
According to figures released today, the price level increased by 1.7% year on year in August 2011. Annual headline inflation was thus unchanged from July. The annual rate of monetary-policy relevant inflation, i.e. inflation adjusted for the first-round effects of changes to indirect taxes, was also flat at 1.7% in August and remains slightly below the inflation target.
Annual headline inflation was 0.4 percentage point lower in August 2011 than the CNB’s current forecast. The downward deviation from the forecast was due mainly to food prices as a result of an unexpectedly sharp seasonal fall in fruit and vegetables prices. Lower-than-expected annual growth in regulated prices acted further in the same direction; however, it was due to a slower increase in rents and health care prices in July. Adjusted inflation excluding fuel price was also slightly lower in August than expected by the CNB.
Despite the above deviations, the August inflation data are broadly in line with the message of the CNB forecast. According to this forecast, the inflation pressures from the domestic economy were not significant and commodity and food prices were the main source of inflation in the past period. Headline inflation will be close to the inflation target over the entire forecast horizon. Headline inflation will be slightly above 3% in 2012 owing to an increase in the reduced VAT rate, but will return to the target at the start of 2013.
Tomáš Holub, Executive Director, Monetary and Statistics Department