HR: Inflation eased further to 1.6% y/y in September

Instant Comment , 1. Okt.
CPI maintained downward trajectory

Annual price growth moderation remained present also in September, with CPI flash landing at 1.6% y/y (1.8% y/y in August), thus landing somewhat below our expectations, where we saw figure marginally edging up compared to month before, as we expected less benevolent developments on energy front. On monthly level prices were up by only +0.3% m/m, with available breakdown suggesting that energy and services had deflationary tone (-2.0% and -0.7%, as follows), while food and industrial goods were up 0.2% and 2.9%, respectively. Detailed breakdown will be available in mid-October, delivering more insights. Looking ahead, we continue to see supply-side factors remaining largely in check (though reflecting hike of administrative gas and electricity prices) and demand-side pressure reflecting strong real wage growth and the tight labor market. While the fading base effect points to some modest y/y CPI acceleration down the line, September figure adds a notch or two of downside risks to our 3% CPI average forecast for 2024.