CPI inflation in Poland amounted 1.1 percent year-on-year in July, statistics office GUS announced. The month-on-month CPI figure was 0.3 percent.
Annual CPI was well above the expectations of analysts surveyed by the Polish Press Agency. They saw July inflation at 0.5 percent y/y and 0.2 percent m/m.
Prices of housing-related goods and services grew by 1.5 percent month-on-month, those in the transportation sector grew by 1.1 percent and those in recreation and culture grew by 0.6 percent. Housing-related price growth was most influenced by a 47.6 percent increase in waste management prices due to the enforcement of a new law in the sector.
At the same time prices fell month-on-month in the clothing and footwear and food and non-alcoholic beverages sectors (by 2.7 percent and 0.3 percent respectively).
In an e-mailed comment, BZ WBK economists wrote that the strong growth in July raised the CPI path for the upcoming months. “As a result, [the] inflation rate will be probably closer to 2% than to 1% and the end of this year, while [the] inflation target of 2.5% may be reached already in 1H2014,” they said.
“However, this is not necessarily a sign of rising inflationary pressure – [the] rise in CPI was mostly due to [a] low base from last year and to changes in administered prices,” the economists wrote. The increase may still be an argument for the Monetary Policy Council to consider interest rate hikes, they added.
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