Household energy prices increased by 1.5 percent, the price of goods in the category that includes vehicle fuel climbed 2.9 percent and service prices were up 1.0 percent. Vehicle fuel prices rose by 5.9 percent.

Core inflation, which excludes volatile fuel and food prices was up by 2.7 percent. Inflation adjusted for a basket of goods and services used by pensioners was 2.5 percent. In a month-on-month comparison, CPI was 0.4 percent, boosted by a 3.3 percent increase in prices of vehicle fuel and a 1.0 percent rise in clothing prices.

In a monthly analysis of inflation developments released after the publication of the KSH data, the National Bank of Hungary said its measures of underlying inflation developments continued to be at or around 2 percent and remained below the level of core inflation.

The indicator for core inflation excluding the effects of indirect taxes fell to 2.2 percent in November from 2.3 percent in the previous month.

The central bank noted that inflation was mainly boosted by volatile items, such as food and energy, and the contribution of demand-sensitive products was largely unchanged from the previous month. Households’ inflation expectations “remained at moderate levels” during the month, it added.

Analysts interviewed by MTI said inflation was in line with expectations in November. Sándor Jobbágy of the CIB Group said the effect of wage rises continues to appear more slowly than expected in the trend of inflation, mainly due to the demand on the housing market.

He said full-year average inflation could be around 2.3-2.4 percent this year and slightly higher in 2018. Gergely Suppán of Takarékbank forecast 2.4 percent annual average inflation in 2017.

Republished with permission of Hungary Matters, MTI’s daily newsletter.