Data published early Tuesday that showed consumer price inflation continued to slow in October caused little surprise for analysts, who see CPI falling under 3% -- the government’s and the MNB’s target for “price stability” -- by the end of next year.
Hungary’s twelve-month CPI slowed to 5.1% in October from 5.7% in September, the Central Statistics Office (KSH) said in the morning. ING Bank’s Dávid Németh said falling food and oil prices supported the disinflationary trend in October. He said twelve-month CPI was likely to slow to 4.9% in November and 4.8% in December, bringing average annual inflation to 6.3%. Németh said he saw the trend continuing in 2009 and put average annual inflation at 3.4% and year-end CPI possibly under 3%. Even if the forint remains weak, CPI will still be under 4% in 2009, he added.
Erste Bank’s Orsolya Nyeste said rising import prices resulting from the weaker forint were offset by lower oil and food prices. October prices were also affected by sharply higher food and oil prices in the base period, she added. Ms Nyeste said twelve-month CPI could fall close to 3% by end-2009. If the forint’s rate remains between 270 and 280 to the euro, CPI will be higher, she noted. (MTI-Eco)