Consumer prices grew 4.6 percent on a year-on-year (y-o-y) basis in September, which is the highest figure seen since November 2011, a whole ten years ago. Inflation was driven by higher prices of food, fuels and recently also school catering services following cuts in the state financing of lunches at primary schools. Inflation in Slovakia could rise even further in the coming months, especially in January, when new heat, electricity and gas prices come into force, analysts expect.
"We expect that inflation in our country will continue to be high in the coming months and will grow at a rate of around 4 to 5 percent," said 365 bank analyst Jana Glasova, adding that higher prices of production inputs, building materials, petrol, agricultural commodities and food should push inflation upwards.
VUB bank analyst Michal Lehuta has even higher expectations. According to him, inflation should continue to rise, especially in January, when new prices for regulated energy, such as heat, electricity and gas, enter into force. "Price growth in Slovakia could reach its maximum in April, standing around 6.0-6.5 percent. This will be the highest inflation since 2004," noted Lehuta. Analysts of Slovak Central Bank (NBS) also expect a double-digit increase in consumer prices for gas and other energy in January.
According to WOOD & Company analyst Eva Sadovska, full-year inflation should come close to three percent this year. "While inflation reached 0.7 percent in January, it reliably exceeded 2 percent in May and in September stood at 4.6 percent. We thus expect full-year inflation for this year at 2.7-2.8 percent," said Sadovska.
Source: TASR
