The Hungarian consumer price index data for the month of January is set to release tomorrow. According to a KBC Market Research report, the headline inflation is likely to have bounced back a bit to about 2.9 percent year-on-year in the month from December’s print of 2.7 percent. The acceleration is possibly driven by fuel price rise, but also the domestic consumption and high wage dynamic and stimulating the headline inflation.
The main question is that what will happen with the core inflation and with the core inflation filtered from indirect taxes, as the NBH pay big attention on the latter one.
“It is quite likely that it may reach the 3 percent YoY level and so the NBH gets very close to the achievement of inflation target on a sustainable manner”, added KBC Market Research.