Inflation dropped to 5.5% in December

By: Trademagazin Date: 2024. 01. 12. 12:10

Slightly more favorable than expected, inflation decreased to 5.5%, a two-and-a-half-year low, in December from the 7.9% annual rate of price increase measured in the previous month, while the revaluation compared to the previous month was -0.3%. The fact that core inflation decreased to 7.6% from 9.1% in the previous month also indicates the easing of inflationary pressure. The average annual inflation in 2023 was 17.6% based on the above data.

The process continues to be substantially supported by base effects, the sharp rise in household market energy prices a year ago has been avoided, and the sharp rise in food prices that was still present a year earlier has also slowed below the 5% inflation rate. Partly due to the strengthening of the forint and partly due to the slowing demand, the price increase of durable consumer goods also showed a slight decrease and fuel prices also decreased compared to the high base of a year ago, which was negatively offset by the still spectacular increase in the price of services.

In the last month of the year, due to the strong base effects, the slowing demand, the ever-wider price corrections appearing in food and the steps to strengthen competition, as well as the stifling price increases of the following durable goods due to the strengthening of the forint – the exchange rate is -5% on an annual basis – inflation further we expect it to decrease in the first months of this year as well. The fact that most of the international raw material and energy prices have already fallen to 2021 levels in recent months plays a role in the base effects.