Inflation in the Czech Republic slows to 1.4 per cent in February

Inflation in the Czech Republic continued to ease in February. According to the Czech Statistical Office, the annual inflation rate stood at 1.4 per cent – the lowest level since October 2016.

Consumer prices in the Czech Republic rose only moderately in February. The inflation rate reached 1.4 per cent year on year, slightly below the January figure – and the lowest level since October 2016. Developments in food and non-alcoholic beverages in particular contributed to the further easing of price increases.

On a month-to-month basis, consumer prices even declined slightly in February. Overall, the price level fell by 0.1 per cent. Lower prices were recorded mainly for food and non-alcoholic beverages. Margarine became significantly cheaper, with prices falling by 16.9 per cent, as did long-life semi-skimmed milk, which declined by 7.6 per cent. Cereal products, non-alcoholic beverages, pork, cheese as well as chocolate and cocoa also became cheaper.

On the other hand, some sectors saw rising prices. In the recreation, sport and culture category in particular, organised holidays and package holidays increased by 4.8 per cent. Prices in transport also rose slightly, mainly due to higher costs for fuels and lubricants. Among food items, vegetables also became more expensive, rising by 2.3 per cent, with potatoes recording a particularly strong increase of 13.8 per cent. Eggs also rose in price by 4.7 per cent.

Price developments year on year

In year-on-year terms, several categories again had a noticeable impact on the overall price level. Prices for alcoholic beverages and tobacco products in particular rose significantly, increasing by 4.0 per cent overall. Prices in restaurants and accommodation also increased noticeably: restaurant services rose by 4.2 per cent, while accommodation prices increased by as much as 6.8 per cent.

In the housing category, rents rose by 6.1 per cent, among other increases. Water supply, sewage charges and services related to minor household repairs also became more expensive. By contrast, energy prices declined significantly: electricity prices fell by 11.9 per cent year on year, while natural gas prices dropped by 7.2 per cent.

Individual food prices also continued to rise strongly. Beef, for example, increased by almost 22 per cent compared with the previous year, while eggs were around 16.5 per cent more expensive.

Overall, goods and services developed differently. While goods became 0.7 per cent cheaper year on year, prices for services rose by 4.5 per cent.

Harmonised Index of Consumer Prices (HICP)

The European comparison indicator also shows moderate developments in the Czech Republic. According to preliminary calculations, the Harmonised Index of Consumer Prices (HICP) stood at 0.9 per cent year on year in February. Inflation therefore remains well below the eurozone average, which Eurostat estimates at 1.9 per cent. Within the European Union, Romania (8.5 per cent) recently recorded the highest inflation rate, while France (0.4 per cent) reported the lowest.