Saturday, 9 October 2021

Inflation Rate in Croatia Could Be Higher, Says Boris Vujčić

October 9, 2021 - When it comes to the inflation rate in Croatia, it will accelerate to 2.3 percent this year, and slow slightly to 2.1 percent in 2022, according to the Governor of the Croatian National Bank (CNB), Boris Vujčić.

The Governor of the Croatian National Bank (CNB), Boris Vujčić, said in the Croatian Parliament on Thursday that, unlike the forecasts of economic growth, the projections of inflation are dominated by negative risks, such as those that could lead to higher rates, reports Poslovni Dnevnik. In Parliament, where he presented the CNB's semi-annual information on the financial situation, price stability, and implementation of monetary policy in the second half of last year, Vujčić reminded of the CNB's projections for economic growth of 8.5 percent this year, and 1 percent in 2022, which he estimated, will have a positive impact on employment and wages.

"Due to the still great uncertainties, it is possible that these projections will not be realized, but unlike the previous ones, the positive and negative risks are balanced," said Vujčić. He explained that the negative risks to the economy relate to the possibility that the epidemiological situation in the euro area will worsen in the fourth quarter and the restrictive measures will be tightened, which would result in weaker foreign demand and negatively affect Croatian exports.

When it comes to inflation, it will accelerate to 2.3 percent this year, and slow slightly to 2.1 percent in 2022. In the previous part of the year, the acceleration of inflation occurred mainly under the influence of rising energy and food prices, said Vujčić, emphasizing that the projections of inflation are dominated by negative risks, ie those that could lead to higher rates.

Previously, in mid-September, Vujčić himself commented on the expectations about the inflation rate in Croatia regarding the next insertion of the euro as the official currency in the country, commenting about the situation in the United States, that ''it has a higher inflation rate, but the economy is overheated there, they also have strong fiscal stimuli that are stronger than European ones and I do not see that at this time such an inflation rate could happen in Croatia, we expect that year-round inflation rate to be 2.2 percent. This is, in principle, the goal of the European Central Bank, so we should not be concerned about that. The problem is if there is a change in expectations, wage growth, but we do not see that at the moment''.

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Friday, 17 September 2021

Croatia's August Inflation Rate Picks Up to 3.1%, Highest Since April 2013

ZAGREB, 17 Sept 2021 - Consumer prices in Croatia rose by 3.1% in August 2021 compared with the same month in 2020, which is the highest inflation rate since April 2013, when it was 3.3%, according to figures released by the National Bureau of Statistics (DZS) on Friday.

The first stronger rise in inflation was recorded in April this year, of 2.1%. It slowed down to 2.0% in June, before picking up to 2.8% in July and 3.1% in August.

The rise is the result of the spillover of prices from global commodities markets, growing domestic and foreign demand, and a price convergence towards the EU average, notably with regard to services, analysts at Raiffeisenbank Austria (RBA) said in their comment on the DZS report.

The rise in consumer prices accompanied the rise in industrial producer prices, which grew by 9.3% in August 2021 compared with August 2020, their highest jump since January 2011. This year industrial producer prices increased by 3.5% in March, 5.8% in April, 7.6% in May, 7.2% in June and 7.9% in July.

Transport prices increased the most, by 9.9% compared with August 2020.

Compared with July 2021, consumer prices went up by 0.2% on average.

In the first eight months of 2021, compared with the same period of 2020, consumer prices rose by 1.7%. The greatest contribution to the rise came from energy prices, which increased by 5.2% on average. At the same time, consumer prices excluding energy rose by 1.0%.

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