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Falling consumer durable prices brighten October CPI

Hungary's twelve-month consumer price index was lower than expected in October because of a month-on-month drop in consumer durables prices, analysts told MTI.

Twelve-month consumer price inflation slowed to 4.7% in October from 4.9% in September, the Central Statistical Office (KSH) said in the morning. Consumer durables prices were up 4.9% in twelve months, but fell 0.7% in a month-on-month comparison. Overall prices were unchanged in October compared to September.

MKB Bank analysts had put October CPI at 4.8%, Zsolt Kondrát told MTI. Most of the data were in line with expectations, but projections were for a month-on-month rise in consumer durables prices, he added. He attributed the drop to the stronger forint and continued weak demand.

Kondrát put year-end twelve-month inflation at 5.9% and average annual inflation for 2010 at 3.2%.

Orsolya Nyeste of Erste Bank said the 4.7% figure for October CPI was a positive surprise as the market consensus was 5%. She put the month-on-month declines in the prices of consumer durables and services behind the slowdown.

Nyeste projects year-end CPI of 6.1%, but sees the index falling to around 2% in the second half of 2010. (MTI – Econews)