Hungary’s 2018 inflation at 2.8%

16 Jan 2019

graphHungary’s headline inflation rate for 2018 was recorded at an average of 2.8%, according to a statement published by the Central Statistics Office (KSH).

The percentage drop, which fell below the official target of 3.0%, had been affected by lower oil and fuel prices. However, it still increased from the 2.4% average of 2017.

On the other hand, core inflation – excluding indirect taxes – reached its highest point since 2012.

KSH said: "Inflation in Hungary slowed to 2.7 percent year-on-year in December from 3.1 percent in November and stood at 2.8 percent on average for the whole of 2018.

"In 2018, compared to 2017, consumer prices rose by 2.8% on average, within which food prices grew by 4.2%.

"The highest price rise of 5.6% was recorded for alcoholic beverages and tobacco. The price of miscellaneous goods went up by 3.8%, services prices by 1.6%, the price of electricity, gas and other fuels by 1.4% and that of clothing and footwear by 0.5 percent on average. Consumers paid 0.4% less for consumer durables," KSH added.

Prices fell by 0.3% from November to December, following a similar drop from October to November.

ING reported that underlying inflation is expected to strengthen over the next few months. Companies ought to re-price their goods in January, labour is becoming increasingly expensive, prices of capital goods are on the rise, input prices are on the increase and the HUF is weak – all of which could lead to companies raising their prices for 2019.