The CNB comments on the February 2009 inflation figures
Inflation comes in above CNB forecast in February 2009
According to figures released today, annual inflation decreased slightly further in February 2009 compared to January, reaching 2.0%. This means that it was at the lower boundary of the tolerance band set by the CNB around its target of 3%. Monetary-policy relevant inflation (1.4% year on year in February), i.e. inflation adjusted for the first-round effects of changes to indirect taxes, also continued falling and was below the lower boundary of the inflation-target tolerance band for the third consecutive month.
The price level picked up by 0.1% in February 2009 compared to the previous month. Month-on-month consumer price growth was mostly due to fuel prices, which increased after seven months of decline, the seasonal pattern of prices of domestic and foreign mountain holidays and prices of financial services. As regards food, prices of fruit and vegetables (including potatoes) went up, whereas those of bread, flour, milk, cheese, butter and non-alcoholic beverages went down. Another contribution to a decline in the price level came from lower household expenditure on regulatory health care fees at health care organisations established by the regions.
Headline annual inflation in February 2009 was 0.5 percentage point higher than the current CNB forecast. According to preliminary calculations, this deviation was due in roughly equal measure to fuel and food prices. Food prices have not yet reacted as expected to the pronounced fall in world food prices and domestic agricultural producer prices and thus it cannot be ruled out that they will decrease further in the coming months. Higher fuel prices were due to a weaker-than-forecasted exchange rate of the koruna against the US dollar. Compared to the forecast, household expenditure on the regulatory health care fees had an anti-inflationary effect and annual adjusted inflation excluding fuels was also slightly lower than forecasted by the CNB. The fall in annual consumer price inflation in recent months reflects the unwinding of one-off cost effects from late 2007/early 2008 and the impact of a recent decline in prices of energy and food commodities on the world markets. In 2009, according to the latest CNB forecast, inflation will initially decline further almost to zero but start growing gradually at the end of the year and get close to the new inflation target of 2 % in 2010 H1.
Tomáš Holub, Executive Director, Monetary and Statistics Department
The CNB comments on the February 2009 inflation figures
Inflation comes in above CNB forecast in February 2009
According to figures released today, annual inflation decreased slightly further in February 2009 compared to January, reaching 2.0%. This means that it was at the lower boundary of the tolerance band set by the CNB around its target of 3%. Monetary-policy relevant inflation (1.4% year on year in February), i.e. inflation adjusted for the first-round effects of changes to indirect taxes, also continued falling and was below the lower boundary of the inflation-target tolerance band for the third consecutive month.
The price level picked up by 0.1% in February 2009 compared to the previous month. Month-on-month consumer price growth was mostly due to fuel prices, which increased after seven months of decline, the seasonal pattern of prices of domestic and foreign mountain holidays and prices of financial services. As regards food, prices of fruit and vegetables (including potatoes) went up, whereas those of bread, flour, milk, cheese, butter and non-alcoholic beverages went down. Another contribution to a decline in the price level came from lower household expenditure on regulatory health care fees at health care organisations established by the regions.
Headline annual inflation in February 2009 was 0.5 percentage point higher than the current CNB forecast. According to preliminary calculations, this deviation was due in roughly equal measure to fuel and food prices. Food prices have not yet reacted as expected to the pronounced fall in world food prices and domestic agricultural producer prices and thus it cannot be ruled out that they will decrease further in the coming months. Higher fuel prices were due to a weaker-than-forecasted exchange rate of the koruna against the US dollar. Compared to the forecast, household expenditure on the regulatory health care fees had an anti-inflationary effect and annual adjusted inflation excluding fuels was also slightly lower than forecasted by the CNB.
The fall in annual consumer price inflation in recent months reflects the unwinding of one-off cost effects from late 2007/early 2008 and the impact of a recent decline in prices of energy and food commodities on the world markets. In 2009, according to the latest CNB forecast, inflation will initially decline further almost to zero but start growing gradually at the end of the year and get close to the new inflation target of 2 % in 2010 H1.
Tomáš Holub, Executive Director, Monetary and Statistics Department