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Hungary CPI slows to 5.5% in March

Figures

Consumer prices in Hungary rose 5.5% yr/yr in March, slowing from a sharp rise of 5.9% yr/yr in February, the Central Statistics Office (KSH) said on Wednesday.

Consumer prices rose 0.8% in March, at the same monthly pace as in February.

London emerging-market analysts forecast the twelve-month rate between 5.4-5.6% on Tuesday. Analysts polled by the business daily Napi Gazdaság put twelve-month inflation at 5.7% and the monthly rate at 0.9%.

January-March inflation came to 5.6%, compared to last year's annual average inflation of 3.9%. Tax changes, including excise-tax increases and a 2%-point rise in the main VAT rate, rising fuel prices and the weakening forint pushed the twelve-month CPI up from 4.1% in December to 5.5% in January and 5.9% in February.

Excluding the effect of tax changes, March inflation would have been 0.6% mo/mo and 3.4% yr/yr, both down from 0.7% and 3.9%, respectively, in February.

Seasonally-adjusted core inflation fell both on the month--to 0.5% in March from 0.6% in February--and on the year--to 5.0% from 5.4%.

The monthly rise of food prices slowed to 0.8% from 1.7 % m/m in February, although seasonal foodstuff prices rose 4.1% in a month. Clothing and footwear prices were up 0.9% m/m in March after dropping on winter sales in the previous two months. Consumer durables became 0.3% cheaper after a 0.1% m/m increase in February as the forint recovered part of its sharp weakening early this year. Household energy prices went up 0.2% from February after a 2.7% m/m monthly increase, and services prices were up 0.2% after a plus of 0.3% in February.

The largest monthly rise, of 3.0%, was registered with alcoholic beverages and tobacco after a 0.9% rise in the previous month. Vehicle fuel and lubricant prices followed with a 2.4% increase following a 0.5% drop m/m in February.

Food prices were up 4.9% in the twelve months to March, at the slowest twelve-month pace since December, and rising below the headline index for the first time in many months. A 12.5% yr/yr drop in seasonal foodstuff prices, a 15.5% drop in the price of flour and a 9% drop in the price of sugar tempered sharp rises elsewhere, including a 43.1% rise in egg prices or a 30.5% rise in the price of fat.

In a twelve-month comparison vehicle fuels and lubricants were up the most, by 16.4%, rising still slightly less yr/yr than January and February, followed by alcoholic beverages and tobacco, whose prices rose 10.8% yr/yr in March. Household energy prices continued to rise at an above average rate, of 8.6%, including a 11.9% rise in district heating and a 11.7% in bottled price prices.

Services prices were up 4.1% yr/yr, less than the 4.5% increase in February and consumer durables were 1.4% cheaper than in March 2011, about the same as in the previous months. Clothing and footwear prices were up 3.6% yr/yr after a 4.8% rise in February.

EU harmonized inflation (HICP) in Hungary was 0.8% a month and 5.5% yr/yr in February compared to 0.6% m/m and 5.8% yr/yr in February.

Prices in pensioners' basket of goods went up at a slightly-below-average 0.7% a month and with the average 5.5% on the year. The rises were down from 1.1% m/m and 6.0% yr/yr in February.

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