Hungary’s consumer price inflation accelerated to 2 percent year-on-year in October from 1.6 percent in September, the Hungarian Central Statistical Office (KSH) reported. That is the highest rate since April. Core inflation also rose, reaching 2.1 percent, likewise the highest level since spring.
Forecasts narrowly missed
Analysts polled by Portfolio had expected average inflation of 1.9 percent in October, with all but one forecaster pointing to either 1.9 percent or 2 percent. The actual reading came in just above that consensus.
Fuel prices were a main driver of the acceleration, up 11.3 percent year-on-year and 3 percent on the month. Fuel prices have risen 9 percent over the last two months, a move that added 0.5 percentage points to headline inflation. Services prices also pushed the index higher, climbing 5.2 percent year-on-year; theatre service prices rose more than 8 percent month-on-month, a move linked to the new theatre season, while official taxi prices rose 11.6 percent year-on-year.
Food and goods prices softer
Food prices, including catering services, fell 1.1 percent year-on-year but edged up 0.2 percent on the month. Clothing prices rose 2.1 percent month-on-month, and durable goods prices rose 0.2 percent on the month.
Inflation remains below the midpoint of the National Bank of Hungary’s target band. The central bank’s base rate stands at 5.5 percent, and further rate cuts in the last two months of the year could still follow if only the current inflation picture were considered, though the outcome depends on whether tensions in the Middle East and energy markets ease. Separately, US annual inflation stood at 3.7 percent in September, near a 31-day high.
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Source: Hungarian Central Statistical Office (KSH) | Data: FRED — St. Louis Fed
