BRATISLAVA, Feb 28 (Reuters) - Slovak consumer prices,
calculated under the EU methodology, rose faster than expected
by 2.1 percent on the month in January, putting the annual
inflation rate at 3.2 percent, Statistics Office data showed on
Monday.
Analysts in a Reuters poll had forecast prices to rise by
1.9 percent on the month and by 3.0 percent on the year.
Inflation increased month-on-month mainly due to a 5.4
percent rise in prices of housing, water, electricity and gas,
which traditionally have a strong weight in the overall
inflation basket.
Prices of food and non-alcoholic beverages jumped by 2.6
percent in January, while transportation prices, driven by
higher costs of oil, rose by 3.3 percent.
Inflation was expected to jump this year to among the
highest levels in the European Union driven by food, commodity
and energy prices, plus a hike in Slovakia's value added and
excise taxes.
The euro zone member's jobless rate jumped to near six-year
high of 12.98 percent in January -- again, among the highest in
the EU -- and analysts expect only a slow and gradual recovery
of household consumption.
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SLOVAK EU-NORM INFLATION JAN 11 JAN 11 FCAST
pct change mo/mo 2.1 1.9
pct change yr/yr 3.2 3.0
(Full January data table .............. [])
===============================================================
ANALYSTS COMMENTS:
EDUARD HAGARA, SENIOR ANALYST, ING BANK
"Data came in line with local inflation figures, seen two
weeks ago. The only difference was in consumer baskets,
methodology."
"Inflation remains driven by regulated prices of energy,
food prices and there are no visible demand-led inflationary
pressures."
"Consumer demand is weak and is likely to pick up only in
the second half of the year."
LUBOMIR KORSNAK, ANALYST, UNICREDIT BANK
"The inflation jump was driven by several factors in
January, same trends as in local inflation data. Key
contributors were prices of food, prices of housing, energy and
also higher value added tax, which, however, has not yet
transformed into prices to a full extent."
"We expect consumer prices will continue to rise throughout
the year to a peak of around 4.0 percent in the fall."
DETAILS
- For month-on-month inflation, prices of food and non-alcoholic
beverages increase by 2.6 percent in January, after a 0.8
percent rise in the previous month.
- Transportation prices jump by 3.3 percent in December,
following a 1.1 percent increase in the previous month
- Prices of alcoholic beverages increase by 0.6 percent after a
0.3 percent drop in December.
- Housing, water, electricity, gas and other utility prices are
up by 5.2 percent after a 0.1 percent rise in December.
- Recreation and culture-related prices edge up by 0.4 percent
in January, after a 0.2 percent rise in December.
BACKGROUND
- The finance ministry expected average annual inflation rate to
accelerate to 3.4 percent this year and slow to 3.0 percent in
2012.
- Slovakia, a euro zone member since January 2009, was severely
hit in 2009 by the global economic downturn as demand for its
exports faded in its main western markets.
- The heavily export-reliant economy contracted by 4.8 percent
in 2009, but it was recovering from the crisis at an
above-average pace and returned to growth with a 4.0 percent
rise in 2010
- The central bank expected the economy to slow to 3.0 percent
rise this year, on impacts of planned fiscal consolidation and
external trends.
- The country's economic activity has been slowing from record
growth rates seen in 2007, when it posted 13.5 percent GDP
growth in the fourth quarter and 10.6 percent for the year.
LINKS:
- For further details on past data, Reuters 3000 Xtra users can
click on the Slovak Statistics Office's website:
http://wwww.statistics.sk/webdata/english/index2_a.htm
- For LIVE Slovak economic data releases, click on......<ECONSK>
- Schedule of upcoming indicator releases............<SK/ECON09>
- Summary of short-term economic data forecasts......<SK/ECON04>
- Slovak benchmark state bond prices .................<0#SKBMK=>
(Reporting by Martin Santa and Petra Kovacova; Editing by Ruth
Pitchford)
