Stable Inflation Reflected in Moderate Price Growth for Consumers

Consumer prices in October 2024, were on average 3.2% higher than a year earlier. On average, they rose by 0.1% in a month, including a 0.8% increase in the price of vehicle fuel, the Hungarian Central Statistical Office (KSH) reported on Tuesday. Inflation remained at a favorable, low level in October, in line with preliminary government forecasts, Minister for National Economy Márton Nagy said in his comments on the latest data.

In twelve months, food prices rose by 4.5%, including 38.9% for flour, 16.8% for milk, 12.1% for fruit and vegetable juice, 9.9% for edible oil, 9.8% for chocolate and cocoa, 7.9% for butter, 7.6% for restaurant meals, and 6.2% for school meals, compared to October 2023. Within the product group, the price of dry pasta fell by 7.3%, sugar by 2.9%, margarine by 2.7%, and eggs by 2.1%.

Services rose by 7.2%, including tolls, vehicle rental and parking by 10.6%, rent by 10.4%, vehicle repair and maintenance by 9.7%, personal care services by 9.1%, sports and museum admissions by 8.9%, housing repair and maintenance by 8.8%, condominium common charges by 8.4%, and holiday services by 5.8%, KSH added.

The price of alcoholic beverages and tobacco rose by 4.0% and 3.8%, respectively.

Household energy was 4.8% cheaper, including 9.5% for piped gas, and 0.7% for electricity.

The price of durable consumer goods fell by 0.3%, with used cars falling by 7.5%, while jewellery rose by 11.4%, new cars by 5.9%, and household furniture, kitchen, and other types of furniture by 2.4%. Medicines and pharmaceuticals rose 3.6%, while vehicle fuels became 5.2% cheaper.

According to KSH:

in one month, compared to September 2024, consumer prices increased by 0.1% on average.

The report noted that the change of season caused clothing to rise 3.0%. Fuel prices rose 0.8%.

Household energy prices were unchanged on average, with gas 0.5% more expensive, electricity 0.2% more expensive, firewood 1.1% cheaper, and piped gas 0.1% cheaper. The price of services decreased by 0.9% on average, including 6.8% less for telephone and internet services and 1.1% less for holiday services.

Analyzing the data, Márton Nagy said that the significant reduction in the price of some basic foodstuffs and household energy is a major help for Hungarian families.

The minister stressed that the government’s effective economic policy measures had successfully tackled soaring inflation caused by the war and sanctions, bringing it down to single digits last year and smashing it into the ground this year.

To ensure that inflation remains low, the government will continue to maintain its effective and efficient measures,

such as the online price monitoring system, which in addition to controlling inflation, is also helping boost retail competition.

To maintain and enhance fair competition in the retail sector, in addition to the online price monitoring, the government will also support regular consumer protection checks.

The politician also pointed out that low inflation has brought dynamic real wage growth since September 2023, and its predictability is making a significant contribution to boosting consumer confidence, thereby further increasing retail and tourism sales.

Rising consumption, driven by persistently low inflation and real wage growth of close to 10%, is a major contributor to the Hungarian economy’s growth target of above 3% in 2025,

which will be supported by the government’s new 21-point economic policy action plan.

The minister confirmed that under the action plan, the government will mobilize more than HUF 4,000 billion (EUR 9.7 billion) in 2025 to support families and businesses. Of this, HUF 2,632 billion (EUR 6.4 billion) will be available for families, while the Sándor Demján program, which is part of the action plan, will mobilize around HUF 1,410 billion (EUR 3.4 billion) for small and medium-sized enterprises (SMEs) in Hungary.

Via MTI; Featured image via Pexels