Prices ``in the consumer goods producing branches show some worrying signs, suggesting that external shocks started to impact a broader range of product categories,'' said the economists, led by Mariann Trippon. They forecast a third consecutive rate increase in this month to 8.5 percent.
Hungary's March industrial producer price inflation was up to 5.7% year on year from 4.9% in February, according to the Central Statistics Office (KSH) last Wednesday. Month on month prices were up by 0.2% in March, down from the 0.7% rate registered in February.
Domestic producer price inflation came in at 10.8% year on year in March (versus 10.6% year on year in Feb and +7.8% in March 07) and in monthly terms it was up by 0.8%, slightly above the increase of 0.5% in the previous month (and the 0.4% for March 2007).
Producer prices in manufacturing industry were up 0.1% month on month and 4.4% year on year, against 0.7% and 3.4% respectively in February.
More disturbingly export sales prices in March rose by 2.0% year on year against an increase of 0.8% in the previous month and a drop of 5.5% in March 2007. Month on month there was a 0.3% decline in export prices, following an 0.8% increase in February and 0.4% increase month on month in March last year.
Food price inflation came to 0.6% m/m (vs. 0.9% in Feb) and 13.8% yr/yr (vs. +13.1% in Feb). On the domestic front food price inflation ticked up to 0.6% m/m from 0.2% in Feb, but increased some in annual terms to 13.0% from 12.5%.
Given that the Hungarian economy is now structurally dependent on exports for growth these increases in export prices are hardly to be welcomed, to say the least.