CPI (Jun): 0.1% m/m, 5.6% y/y
Consensus: 5.4% y/y
Previous (May): -0.2% m/m, 5.3% y/y
The y-o-y inflation accelerated more than expected in June, although the monthly growth of consumer prices is not big. The index was driven higher by services and tobacco, influenced by tax hike with a delay. The prices of food decreased marginally as the fall of the seasonal food prices was not as significant as last year. The fuel prices dropped.
The minutes from the last MNB meeting proved that the central bankers will consider monetary easing if the inflation outlook improves and the risk premium decreases. The June inflation data shows that disinflation is not very fast; the core inflation increased slightly to 4.9 pct. It might, therefore, influence the decision about the potential rate cut. However, the agreement between the Hungarian government and the IMF/EU seems to be a more important factor; a monetary easing is still unlikely until the country gets very close to the deal.