Consumer Price Indices - Basic Information

The month-on-month decrease in the consumer price level was brought about primarily by a decrease in prices in housing and in ‘transport‘. In housing, prices of natural gas dropped by -5.5%. In ‘transport‘, prices of automotive fuel continued dropping for the second month and the decrease reached in October -5.5%, too. The drop in food prices was brought about by lower prices of fresh vegetables and moderate zone fruit (-8.4% and –10.2%, respectively), similarly as in the previous month. Prices of bread and cereals dropped by –1.7%, of which prices of rolls and baguettes by –5.4% after a rise that lasted for 6 months. A drop in ‘recreation and culture’ was caused mainly by an annual seasonal decrease in prices of domestic recreational stays. Similarly, in ‘health‘, prices of recreational stays at spas were lower due to the summer season, which came to an end.

On the other hand, an increase in the consumer price level was influenced by a price increase in ‘clothing and footwear‘, which was caused particularly by higher prices of a new assortment of winter cloth and shoes. In food, prices of coffee, tropical fruit, flour, cocoa and potatoes went up (range from 1.1% to 3.1%).

In total, prices of goods dropped by -0.8% and prices of services by -0.1%.

In terms of year-on-year comparison, consumer prices growth amounted to 1.3% in October. This low y-o-y increase was last time in May 2005. The y-o-y growth slowed down by 1.4 percentage points on September, which is the biggest slowdown since January 1999. It was influenced primarily by prices in housing (by 0.8 percentage points), in ‘food and non-alcoholic beverages’ (by 0.3 percentage points), in ‘recreation and culture’ (by 0.2 percentage points) and ‘transport‘ (by 0.1 percentage point).

In housing, a rise in prices of natural gas slowed down to 0.4% in October from 24.6% in September. The reason was a different month-on-month development in October 2006 (a drop by –5.5%) and in October 2005 (a growth by 17.4%). Prices of natural gas recorded the lowest y-o-y price increase since October 2004. In ‘food and non-alcoholic beverages’, the y-o-y growth of prices slowed down particularly in bread and cereals, fresh vegetables and moderate zone fruit. In ‘recreation and culture’, the rise in licence fees for television equipment and radio, which was observed in October 2005, stopped to have influence in terms of y-o-y comparison. In ‘transport‘, the drop in prices of automotive fuel deepened y-o-y (-10.8%).

The decisive influence on y-o-y rise in consumer prices belonged again to price changes in ‘housing, water, electricity, gas and other fuels’ (due to its weight in the consumer basket), in which prices of electricity were higher by 9.0%, heat by 8.1%, and solid fuel by 10.9%. The second biggest effect was due to the price development in ‘food and non-alcoholic beverages’ and ‘restaurants and hotels‘. In food, the biggest increase was recorded for potatoes (95.2%), rolls and baguettes (19.4%), bread (15.1%) and fresh vegetables (6.7%). In the public catering, prices of meals were higher by 2.3%, beer by 4.4%, table and mineral water by 4.2%. Prices of accommodation services went up by 3.1%. The highest rise was recorded for prices in ‘health‘, mainly due to an increase in amounts paid for drugs by patients and in prices of drags and stays at spas.

A reduction in the price level was affected most of all by the drop in prices in ‘transport‘, in which except automotive fuel, prices of transport equipment were lower than in the previous year (-1.7%). The decrease in prices in ‘clothing and footwear‘ and in ‘furnishings, household equipment and routine maintenance of the house‘ continued. Lower than in the previous year were also prices of tropical fruit, poultry, chocolate and chocolate products, cocoa, coffee and tea.

In total, prices of goods went up (0.3%) as well as prices of services (3.0%).

Inflation rate, i.e. an increase in the average consumer price index for last 12 months related to the average CPI for the preceding 12 months stood at 2.7% in October, i.e. by 0.1 percentage point down on September 2006.

According to preliminary data of Eurostat, the year-on-year increase in the average harmonized index of consumer prices (HICP) in the EU25 was 1.9% in September (by -0.4 percentage point down on August 2006). Prices grew most in Latvia and Hungary (both by 5.9%), the least in Finland (0.8%). Growth of prices in Slovakia decelerated to 4.5% (from 5.0% in August). In Germany, the price growth slowed down to 1.0% (1.8% in August).

According to preliminary calculations, in the Czech Republic, the m-o-m decrease was -0.5% in October and the y-o-y HICP growth slowed down to 0.8% (from 2.2% in September). According to the flash estimate published by Eurostat, the y-o-y HICP increase for the Euro-zone was 1.6% in October 2006.

Note
Contact: Marie Huskova, phone (+420) 274054104, e-mail: marie.huskova@csu.gov.cz
Data source: CZSO survey
End of data collection: 20th day of the reference month
End of data processing: 3rd day of the month that follows each reference month
The data are final.
Related publications: 7103-06 Consumer Price Indices – Detailed Information (Internet: https://csu.gov.cz)