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Analysts put March 12-month inflation at 5.7%

Twelve-month inflation in Hungary was 5.7% in March, according to a consensus of analysts polled by the business daily Napi Gazdaság.

This figure is level with February twelve-month inflation, but analysts predict a slight month-on-month rise.

The Central Statistical Office (KSH) will publish March inflation figures on April 13.

Monthly inflation was pushed up by rising petrol prices in March, but several minor base effects, such as seasonal food products and consumer durables, presumably restrained price rises, Gergely Suppan of Takarékbank told the paper.

Zsolt Kondrát of MKB Bank said the March increase in fuel prices could contribute close to 0.1% to inflation on a monthly basis and 2.5% yr/yr. Otherwise, major processes influencing inflation remain unchanged, while market prices depressed due to recession have no room to increase due to rises of centrally regulated prices, Suppan said.

The Takarékbank analyst added that he believes the trend of falling inflation will continue, with inflation slowing down to 5.1% in May, when the effect of the April gas-price rise will materialize, which, however, could be offset by base effects such as last May's weak forint and higher seasonal food-prices. In July, Suppan expects inflation at a few tenths of a percentage point over 3% because of the higher base due to last year's VAT increase, but there is a lot of uncertainty in this area, mainly due to the phasing out of the gas-price compensation.

György Barcza of K&H Bank put inflation at over 4% at the end of the year, primarily due to base effects such as food, energy and service prices, which could push the index up in the second half of the year. (MTI – Econews)