In June 2016, consumer prices edged down by 0.2 percent year-on-year. Stable prices help preserve the value of wages and pension benefits, and these boost consumption and economic growth.

Inflationary processes continue to be benign; the majority of product groups have been characterized by subdued price changes. Crude oil prices are some one-fifth lower than one year ago. Accordingly, fuel prices are well below those in the corresponding period of 2015, and this factor reduced the overall index by 0.9 percentage points. On the other hand, lower transport costs have positively influenced the prices of other goods and services; therefore the impact of lower oil prices has been even larger than that. Consumers benefited from the reduction of VAT on pork also in June: related prices were 17.2 percent lower year-on-year.

The latest data are in line with the estimate of the Government’s Convergence Programme of this year, which predicts an inflation rate of 0.4 percent for this year.

(Ministry for National Economy)