Consumer Price Indices - Detailed Information

Commentary

Contents

The level of consumer prices in August rose compared with July by 0.3%. This increase in prices of tobacco products had an upward effect on the consumer price level. The year-on-year growth of consumer prices was 2.4%.


The month-on-month rise of the price level by 0.3% owed mainly to the price increase in ‘alcoholic beverages, tobacco‘, in which prices of tobacco products rose by 6.2%. In ‘recreation and culture‘, prices of recreation stays abroad were higher by 6.1%. In 'housing, water, electricity, gas and other fuels', net actual rentals went up by 1.2 % for dwellings with regulated rentals and prices of solid fuels by 2.0%. In food, mainly prices of meat, milk, cheese and butter were higher than a month earlier (by 1.4%, 1.8%, 4.0% and 2.8%, respectively).

A downward effect on price development came from the fall in food prices, which was brought about mainly by price reduction of potatoes by 21.8%, vegetables grown for fruit by 13.9% and other vegetables by 6.4%. Both prices of clothing and footwear were by 0.7% down due to the summer sales of goods, which continued. In ‘communications‘, a 1.1 % drop in telecommunication services was recorded due to lower charges for roaming and domestic calls provided by some operators. Prices of automotive fuel were lower by 0.3% in August after an increase recorded for the five-month period.

Prices of goods in total increased by 0.2% and prices of services went up by 0.5%.

In terms of year-on-year comparison, in August 2007, the increase in consumer prices was 2.4%, i.e. 0.1 percentage point up compared to July 2007. An accelerated price growth was recorded primarily for ‘alcoholic beverages, tobacco‘, in which prices of tobacco products went up by 26.6% (from 19.3% in July). Prices in ‘food and non-alcoholic beverages‘ recorded a higher y-o-y growth in August compared to July. Prices of meat rose by 2.1% (from 0.7% in July), milk, cheese and eggs by 4.2% (from 2.2% in July), oils and fats by 1.8% (from 0.7% in July). An acceleration of y-o-y growth was recorded for coffee, tea, cocoa, chocolate and sweets due to the drop in their prices in August 2006 (owed to the VAT reduction). In 'housing, water, electricity, gas and other fuels', net actual rentals went up by 15.5% for dwellings with regulated rentals (from 14.1% in July). The market rentals were higher by 0.1%.

A reduction of the price level owed mainly to the drop in prices in ‘recreation and culture‘, ‘communications‘ and ‘transport‘. In ‘recreation and culture‘, prices of audio-visual appliances and equipment, photographic and cinematographic appliances and personal computers were lower by 10.3% on average. Prices of telecommunication services were lower by 1.5% and mobile phones by 20.5%. In ‘transport‘, prices of automotive fuels and cars went down (by 3.5% and 1.3%, respectively). Seasonal prices of vegetables incl. potatoes decreased by 7.3%.

Prices of goods in total grew by 2.5% and prices of services by 2.3%.

Inflation rate, i.e. the increase in the average consumer price index in the twelve months to July 2007 compared with the average CPI in the previous twelve months, stood at 2.0% in August (0.1 percentage points down on July).

According to preliminary data of Eurostat, the year-on-year increase in the average harmonized index of consumer prices (HICP) in the EU 27 member states was 2.0% in July (0.1 percentage point down on June). The highest annual rates were observed in Latvia (9.5%) and Hungary (8.3%), and the lowest rates in Denmark (1.1%). In Malta, they were 0.2% down compared to July 2006. The growth of consumer prices in Slovakia slowed down to 1.2% in July (from 1.5% in June). The price level in Germany rose by 2.0% (the same as in the previous four months).

According to preliminary calculations, the HICP in the Czech Republic in August 2007 increased by 0.3% month-on-month and accelerated to 2.6% (from 2.5% in July 2007), year-on-year. The MUICP (Monetary Union Index of Consumer Prices) flash estimate for the Eurozone in August 2007 was 1.8%, y-o-y, as Eurostat announced.

In August 2007, in comparison to July 2007, consumer prices grew by 0.2% in households of pensioners and by 0.3% in households of employees. Both types of households recorded a higher consumer price index for ‘alcoholic beverages, tobacco‘: households of pensioners by 2.3% and households of employees by 3.5%. The increase was affected particularly by higher prices of tobacco products. Higher index was registered for ‘recreation and culture‘ (0.7% for pensioners and 0.9% for employees) due to growth of prices of recreational stays abroad and prices of repair of audio-visual and information processing equipment. On the other hand, a lower index was recorded for ‘clothing and footwear‘ (-0.6% for pensioners, -0.7% for employees) primarily due to lower prices of women's ready-made clothing and women's footwear. The consumer price index for ‘food and non-alcoholic beverages‘ was down –0.5% for pensioners and –0.4% for employees, as a result of lower prices of vegetables, potatoes and pasta in particular.


In the capital city of Prague, the overall consumer price index (cost of living) grew by 0.2% month-on-month (0.3% in the whole Czech Republic). The consumer price index for ‘alcoholic beverages, tobacco‘ increased by 3.1% (3.2% in the Czech Republic) due to higher prices of tobacco products. Prague registered a higher index for ‘recreation and culture‘ by 1.3% (1.0% in the Czech Republic) particularly due to price increases in recreational stays abroad and radio sets, audio equipment. The consumer price index for ‘housing, water, electricity, gas and other fuels’ grew by 0.2% (0.3% in the Czech Republic), affected mainly by higher net rentals paid by tenants in rented dwellings. On the other hand, a drop occurred in ‘communications‘ by -1.1% (-1.1% in the Czech Republic as well) as a result of lower prices of mobile phones and telecommunication services. The consumer price index for ‘clothing and footwear‘ decreased by -0.9% (by -0.7% was recorded for the whole Czech Republic), which was affected mainly by lower prices of women's and children's footwear and women's ready-made clothing.