The producer price index increased by 0.4% m/m in October. Year-on-year, the increase has stayed at 4.4%. According to expectations, the acceleration of growth in industrial prices was pulled up by the food sector, where prices increased (on a month-on-month comparative basis) the most in past seven years. With respect to October’s oil price increases, the coke sector and refinery products prices grew too. Transportation equipment traditionally softens the production inflation numbers as prices declined. Also, the prices for chemical products declined.
Another acceleration of growth showed up in agricultural products. They increased by 24.4% y/y on the back of mainly plant production costs.
October’s data support the scenario of another interest rate hike. The tightening of monetary policy could however be postponed by the strong Crown.