The high inflation in January is not a Hungarian peculiarity – this is when price increases may slow down

By: Trademagazin Date: 2025. 02. 12. 12:08

The effects of the price increases at the beginning of the year are clearly visible in the latest inflation data. According to the report of the Central Statistical Office (KSH), in January 2025 consumer prices increased by 5.5 percent year-on-year, while a 1.5 percent increase was observed compared to the previous month. However, this inflation level, which exceeded expectations, is not a Hungarian peculiarity, as several EU countries also experienced significant price increases in January – points out VG.

According to the analysis of the Oeconomus Economic Research Foundation, the acceleration of inflation was caused by several unique, seasonal factors. They highlight the tax increases at the beginning of the year, such as the inflation-tracking tax increase and the increase in excise duty on tobacco products, which had a one-off price-push effect on consumer prices.

The inflationary pressure was not only felt in Hungary: Consumer prices have also risen significantly in several EU member states, including Croatia, Slovakia, Slovenia, Austria, Lithuania, Luxembourg, Ireland, Italy and Spain. The average inflation rate for the 27 EU member states in 2024 was 2.6 percent, while the eurozone countries experienced a 2.4 percent price increase.

According to Oeconomus’ analysis, January 2025 could have been a local peak in terms of inflation. According to forecasts, price pressure in Hungary may ease from February-March, and inflation may decrease to around 4 percent by spring. However, fluctuations between 4-5 percent are expected again in the second half of the year, and another acceleration may occur by the end of the year.