The growth of the Czech consumer prices indices (inflation) slowed to 6.9% year-on-year and decreased by 0.7% month-on-month in September. This marks a significant decrease from August’s inflation rate and is the lowest value since December 2021. The moderation was better than expected by market analysts, including the Czech National Bank’s (CNB) forecast, prompting speculation that the CNB may lower interest rates at its November board meeting. However, inflation still remains high above the CNB’s 2% target level.
The positive development came mainly from drops in the sectors of recreation and culture, food and non-alcoholic beverages, and housing, water, electricity, gas, and other fuels. In recreation and culture, prices of package holidays went down by 21.9% month-on-month, reflecting the end of the summer season. In food and non-alcoholic beverages, prices of fruit decreased by 3.8%, vegetables by 2.9%, eggs by 9.2%, semi-skimmed milk by 8.3%, pork meat by 1.8%, oils and fats by 2.2%, smoked meat and sausages by 1.1%, and cheese and curd by 1%.
In housing, water, electricity, gas, and other fuels, prices of natural gas decreased by 3.6%, electricity by 2%, and solid fuels by 1.3%. Month-on-month increases in prices were registered mainly in the sector prices of fuels and lubricants for personal transport equipment (2.8%) and were also registered in clothing and footwear, while the new start of the school year drove prices in education up by 5.8%.
Year-on-year, the most significant price growth was registered in housing, water, electricity, gas, and other fuels, where prices of actual rental climbed by 7.9%, water supply by 16.3%, sewage collection by 26.9% and heat and hot water by 36.2%.
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