The CNB comments on the March 2007 inflation figures
Inflation comes in just below CNB forecast
According to figures released today, annual inflation increased to 1.9% in March 2007, from 1.5%
in February this year. This means that it was just below the lower boundary of the tolerance band
set by the CNB around its target of 3%.
The price level rose by 0.3% month on month in March, among other things due to the lagged price
impact of the changes to indirect taxes on tobacco products in April last year. The fact that fuel
prices increased in March, after a long-running decline, acted in the same direction. Prices of
some food items and new seasonal clothing and footwear models also rose. Prices in the holiday
segment, which recorded a seasonal decline as in past years, moved in the opposite direction in
March.
Annual inflation in March was approximately 0.1 percentage point lower than the January CNB
forecast. As in the past two months, the comparison of the outturn with the forecast is complicated
by the switch to a new consumer basket in January 2007; this was not available at the time the
forecast was prepared. According to previous CNB analyses, the change in the weighting scheme could
lead to rather lower-than-expected headline inflation.
Food prices rose faster in March 2007 than predicted in the CNB's forecast. By contrast, the
contribution of regulated prices to inflation was slightly lower. Adjusted inflation excluding
fuels, which remains very low, recorded the largest downward deviation from the forecast. This
suggests that the current inflationary pressures from the real economy remain moderate.
Tomáš Holub, Executive Director, Monetary and Statistics Department
The CNB comments on the March 2007 inflation figures
Inflation comes in just below CNB forecast
According to figures released today, annual inflation increased to 1.9% in March 2007, from 1.5% in February this year. This means that it was just below the lower boundary of the tolerance band set by the CNB around its target of 3%.
The price level rose by 0.3% month on month in March, among other things due to the lagged price impact of the changes to indirect taxes on tobacco products in April last year. The fact that fuel prices increased in March, after a long-running decline, acted in the same direction. Prices of some food items and new seasonal clothing and footwear models also rose. Prices in the holiday segment, which recorded a seasonal decline as in past years, moved in the opposite direction in March.
Annual inflation in March was approximately 0.1 percentage point lower than the January CNB forecast. As in the past two months, the comparison of the outturn with the forecast is complicated by the switch to a new consumer basket in January 2007; this was not available at the time the forecast was prepared. According to previous CNB analyses, the change in the weighting scheme could lead to rather lower-than-expected headline inflation.
Food prices rose faster in March 2007 than predicted in the CNB's forecast. By contrast, the contribution of regulated prices to inflation was slightly lower. Adjusted inflation excluding fuels, which remains very low, recorded the largest downward deviation from the forecast. This suggests that the current inflationary pressures from the real economy remain moderate.
Tomáš Holub, Executive Director, Monetary and Statistics Department