MNB vice-president: it is necessary for the food price competition to start going down

By: Trademagazin Date: 2023. 02. 13. 12:52

Barnabás Virág, vice president of the Hungarian National Bank (MNB), told Napi.hu that it is good news that the rise in food inflation has stopped. At the same time, according to him, it is necessary for the price competition to start downward.

“The good news is that the rise in food inflation has stopped, although its rate is still very high. The most important information in terms of assessing more permanent trends was the January price increases seen in some segments of the service sector, which were significantly higher than before. This is a sign that calls for caution. warn anyone expecting a quick collapse of inflation”

– explained the specialist to Napi.hu.

“European energy prices have fallen significantly, global shipping prices have been corrected, while world food prices have been decreasing continuously for the 10th month. Our financial markets are also characterized by a stable situation, so the mentioned price reductions should be more and more effective in domestic supply chains as well. Maintaining financial market stability continues will also be an important key to breaking inflation and achieving price stability again. These effects are coupled with the narrowing of internal demand, which has a disciplining effect on retail pricing decisions. If a company does not want its customers to defect from it, then it is necessary to start to enforce falling costs in consumer prices as well. A price competition must also start downwards! There will be room for this.”

– he added.