György Raskó: There could be a big rise in prices after the introduction of the food price cap

The procurement prices will surpass the long-frozen retail prices at major discount retailers, and the situation may be even costlier at smaller local stores unaffected by the new regulations. However, the government believes that inflation will only experience a moderate rise following the removal of price controls. In response to potential price hikes, some restaurants have already started using fats instead of oil to reduce costs. According to Eurostat, Hungary has seen the highest increase in the prices of fats and oils in the EU, with a 33% rise compared to last year, exceeding the average of other member states by 10%. National Bank President György Matolcsy previously stated that price caps contribute to inflation and result in a 3-4% loss. Although the government denies that inflation will rise, it has discontinued the price controls on food items while introducing mandatory promotional campaigns. Minister Gulyás Gergely, head of the Prime Minister’s Office, believes that the overall impact will be minimal on inflation as a whole. Businesses should prepare for rising prices and seek alternative solutions to mitigate costs.