Updated 10:38
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The Czech Statistical Office (CSO) published new data on rising inflation in the Czech Republic on Monday. Record inflation does not slow down and adds wrinkles on the forehead to both consumers and economists. The rise in prices may soon be the highest since 1993.
Compared to March last year, prices in shops increased by 12.7 percent on average. This is 1.6 percentage points more than inflation was in February. This follows from information newly published by the Czech Statistical Office.
The increase in prices was reflected in the receipts at gas stations. “The most significant acceleration in price growth was recorded for fuels, which were half as expensive in March as a year ago. For example, Natural 95 was sold at petrol stations for an average of 44.50 crowns per liter and diesel for 47 crowns per liter,” said the head of the department. CZSO consumer price statistics Pavla Šedivá.
Rising inflation has also affected housing prices, especially energy. Electricity prices rose by 24.7 percent, natural gas by 37.7 percent, heat and hot water by 13.9 percent. Along with them, the costs of maintenance and repair of flats also increased, by approximately 16.4 percent. Due to higher prices of building materials, rents have also risen, especially for new flats.
Among food, butter rose the most, by 31.9 percent. Right behind it is flour with 30.3 percent. Potatoes rose in price by 21.4 percent and semi-skimmed long-life milk by 20.1 percent, according to the CZSO.
The sharpness of inflation also surprised economists, who predicted that it would reach a maximum of 12.4 percent compared to last March. They have rather unfavorable forecasts for further inflation. Its growth will not just stop, on the contrary. It may soon happen that due to the effects of the pandemic and the war in Ukraine, the Czechia will face the highest inflation in history.
According to the Czech Banking Association (CBA), due to the impact of the pandemic and the war, it is very difficult to predict where inflation will rise this year. “For now, we expect 14.5 percent in the middle of the year. Inflation will be around 13 percent for the whole of this year. It will be the highest since 1993,” said CBA chief economist Jakub Seidler.
Economist Štěpán Křeček is also pessimistic about the future, according to whom the arrival of refugees will also have a significant effect. “It can be assumed that apartment rental prices will rise, because refugees from Ukraine will look for rental housing after finding a job, so that they do not have to live in temporary premises in gyms and other unsuitable places,” Křeček thinks.
According to economist Lukáš Kovanda, the significant rise in prices is mainly due to rising fuel prices. “According to the latest forecast of the Czech National Bank, prepared mainly this January (before the Russian invasion of Ukraine), March inflation was expected to be 9.8 percent. However, the invasion changed developments, especially in the area of fuel prices,” Kovanda said.
Although fuel prices have fallen since February, they are still at record levels. “It is mainly this increase that has also made food transport and imports more expensive, which will drive inflation well above the level predicted by the CNB,” Kovanda expects.
TN.cz
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