The CNB comments on the November 2007 inflation figures
Inflation comes in markedly above CNB forecast
According to figures released today, annual inflation rose to 5.0% in November 2007, from 4.0%
in October. This means that it is above the upper boundary of the tolerance band set by the CNB
around its target of 3%. The contribution of the primary effects of indirect tax changes to annual
inflation was more than 1 percentage point. Inflation adjusted for these effects – referred to as
monetary policy-relevant inflation – thus rose to around 4.0%, i.e. it is at the upper boundary of
the tolerance band of the CNB’s inflation target.
In month-on-month terms, the price level increased by 0.9% in November. This was due mainly to a
striking increase in food prices, which recorded the highest month-on-month jump since January
1993. Prices of most kinds of food rose, with price growth of bread products and cereals, eggs,
milk and cheese, fats, oils, vegetables and confectionary products having the largest effect. From
other groups, fuel prices in particular recorded growth. By contrast, a decline in prices of
recreation and culture exerted downward pressure on the price level in November.
Annual inflation in November 2007 was 1.1 percentage point higher than the CNB’s October
forecast. This deviation was due particularly to stronger-than-expected growth in food prices. Fuel
prices were also higher than forecasted. Adjusted inflation excluding fuels, regulated prices and
the effects of indirect tax changes were in line with the CNB’s forecast in November.
Tomáš Holub, Executive Director, Monetary and Statistics Department
The CNB comments on the November 2007 inflation figures
Inflation comes in markedly above CNB forecast
According to figures released today, annual inflation rose to 5.0% in November 2007, from 4.0% in October. This means that it is above the upper boundary of the tolerance band set by the CNB around its target of 3%. The contribution of the primary effects of indirect tax changes to annual inflation was more than 1 percentage point. Inflation adjusted for these effects – referred to as monetary policy-relevant inflation – thus rose to around 4.0%, i.e. it is at the upper boundary of the tolerance band of the CNB’s inflation target.
In month-on-month terms, the price level increased by 0.9% in November. This was due mainly to a striking increase in food prices, which recorded the highest month-on-month jump since January 1993. Prices of most kinds of food rose, with price growth of bread products and cereals, eggs, milk and cheese, fats, oils, vegetables and confectionary products having the largest effect. From other groups, fuel prices in particular recorded growth. By contrast, a decline in prices of recreation and culture exerted downward pressure on the price level in November.
Annual inflation in November 2007 was 1.1 percentage point higher than the CNB’s October forecast. This deviation was due particularly to stronger-than-expected growth in food prices. Fuel prices were also higher than forecasted. Adjusted inflation excluding fuels, regulated prices and the effects of indirect tax changes were in line with the CNB’s forecast in November.
Tomáš Holub, Executive Director, Monetary and Statistics Department