Can the strengthening of the forint be good for food prices?

Among the internal factors affecting inflation, it is important to highlight, according to the MNB’s information, the declining retail turnover, which can modify the determination of prices, thereby curbing price increase efforts, writes Szigethy-Ambrus Nikoletta, international relations analyst at the Oeconomus Economic Research Foundation, in response to the Index’s question.

There are several changes in the food market, primarily the development of grain prices may bring relief in the entire sector in the spring, as the export price decreased in December due to the favorable harvest situation in the southern hemisphere. The current strengthening of the exchange rate and the perceptible drop in world market prices for some products cannot yet affect consumer prices on the Hungarian market, the difference is expected to stabilize in the spring months at the earliest.

The reason for this is the strengthening of the disinflationary effects, which is partly due to the already detailed changes in the grain market. The Minister of Economic Development, Márton Nagy, also reported in an interview that, according to their expectations, food prices will peak in February-March, and may drop drastically from there.