Consumer prices drop in the Czech Republic, but mainly due to a record dip in fuel

A record drop in fuel prices but a brake on inflation in the Czech Republic, but food prices in particular still increased. Consumer prices in April decreased by 0.2% compared with March, while the year-on-year growth of consumer prices slowed to 3.2% in April, according to the Czech Statistical Office (ČSÚ).

The month-on-month April decrease was spurred by fuel price drops, which continued for the third month. For April, the drop reached 10.5%. and was the highest month-on-month price decrease in the Czech Republic since 1993, when the country was established. The average April price of Natural 95 gasoline was 26.37 CZK per liter and average price of diesel was 26.83 CZK per liter.

In the alcoholic beverages and tobacco sector, wine prices dropped 3.5% compared to the previous month, beer fell 3.3% and spirits fell 1.2%. In food, prices for the group of milk, cheese and eggs were lower by 0.7%, and for oils and fats by 2.4%.

A month-on-month April price increase was seen in food and non-alcoholic beverages, where vegetable prices raised by 7.6%, fruit by 2.8% and bread and cereals by 1.0%. In the furnishings, household equipment and routine household maintenance sector, prices of goods and services for routine household maintenance increased by 2.6%.

Month on month, prices of goods in total went down by 0.3% and prices of services by 0.2%.

In a year-on-year comparison, the consumer price index was 103.2%, meaning prices rose 3.2% since April 2019. The biggest influence was the deep price drop fuels and lubricants, which were 16.7% lower in April.

The drop in fuel prices helped to offset increases in other areas, such as food and non-alcoholic beverages, where the year-on-year price growth accelerated. Fruit prices of fruit were higher by 24.7%, compared to 16.2% annual increase registered in March, and vegetable prices rose 11.8%, against a 6.4% year-on-year March rise.

In the furnishings, household equipment and routine household maintenance sector, prices of goods and services for routine household maintenance increased by 6.3% compared to last year, while in March the annual rise was 2.7%.

The biggest influence on the growth of the year-on-year price level in April came from prices in food and non-alcoholic beverages. Flour went up by 16.6%, pork by 18.9%, sausages and smoked meat by 13.8% and sugar by 16.2%.

Another large influence was prices in housing, water, electricity, gas and other fuels, where prices of actual rentals for housing were higher by 4.3%, water supply by 5.3%, sewage collection by 4.5%, electricity by 8.6% and natural gas by 0.4%.

There was also a year-on-year impact from alcoholic beverages and tobacco, where prices of spirits increased by 10.2%, wine by 1.3%, beer by 4.0% and tobacco products by 3.2%.

A reduction in the overall price level came from prices in transport, down by 3.8%, and in communication, mainly due to prices of telephone and telefax services which were lower by 5.0%.

Prices of goods in total went up 3.0% and services rose 3.3%.

The inflation rate, meaning the increase in the average consumer price index in the 12 months to April 2020 compared with the average CPI in the previous 12 months, amounted to 3.1%.

According to preliminary Eurostat data, the year-on-year change in the average harmonized index of consumer prices (HICP) in the EU27 member states (not counting the UK) amounted to 1.1% in March, down 0.5 percentage points down from February.

The rise in prices was the highest in Hungary and Poland, both 3.9%, and the lowest price increase was in Italy, Cyprus, Portugal and Spain, all at 0.1%. In Slovakia, price growth in March slowed down to 2.4% from 3.1% in February. In Germany, prices increased by 1.3%, compared to 1.7% in February.

According to preliminary calculations, the change in the HICP in the Czech Republic in April amounted to 0.2% month-on-month, and 3.3% year-on-year.