MNB inflation measures mixed, stay above CPI

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The three of the National Bank of Hungary (MNB)’s “underlying measures of inflation,” published on Thursday, moved mixed in November. The indicators have been over headline CPI now for the third month in a row.

The indicator for core inflation, excluding indirect tax effects, was 1.2% year-on-year in November, down from 1.3% in October.

The indicator for demand-sensitive inflation, which excludes processed foods from core inflation, stayed at 1.4% y.o.y.

The indicator for sticky price inflation, which includes items for which retail prices vary, on average, no more than 15% a month, rose to 1.6% y.o.y. from 1.5% in October.

Hungary’s twelve-month consumer price index was 0.9% in November, level with the rate in October, the Central Statistics Office (KSH) reported on Wednesday. Fuel prices dropped and increases in food prices were modest. CPI is at a near 40-year low, largely because of government-mandated cuts to household utilities prices.

KSH’s core inflation, which excludes volatile fuel and food prices, was 3.5% y.o.y. in November, up from 3.4% in the previous month. KSH’s index excluding tax changes remained 0.6% y.o.y.
Headline inflation has been on a declining trend since October 2012.

Among the three MNB inflationary gauges, core inflation, excluding indirect tax effects, has been slowing except for a few months since August 2011. Demand-sensitive inflation fell from July 2012 until July this year and levelled out since then. Sticky price inflation levelled out in the first part of 2012, slowed from early autumn 2012 until August this year before the recent rise.

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