Czech inflation seems to have increased slightly in October, likely to reach 1.5 pct by end-2016

Inflation in the Czech Republic is expected to have paused. Decline in food prices in October is likely to have countered the increase in fuel prices. According to a Societe Generale research note, core prices are likely to have risen just slightly, leaving the headline price index up only 0.1 percent.

The annualized inflation figure is thus likely to have increased slightly to 0.6 percent, with the decline in fuel price becoming smaller and the annual decrease in food prices getting slightly deeper again, noted Societe Generale.

Czech’s core price inflation is estimated to have stayed at 1.3 percent. The country’s inflation is expected to accelerate in the months ahead, and reach 1.5 percent by the end of 2016, added Societe Generale. Subsequently, this trend is likely to continue until the start of next year, permitting inflation to reach the Czech National Bank’s target rate of 2 percent in February.