Development of consumer price indices - 1. quarter of 2004
Product Code: e-7132-04
Development of consumer price indices in the first quarter of 2004
After very moderate price growth in 2003 consumer prices in the first quarter of 2004 accelerated their month-on-month and year-on-year growth. This development was caused by a distinctive month-on-month price increase in January 2004 by 1.8% (January 2003 growth was only +0.6%). In February and March the price development was similar to that of 2003. Price jump in January was influenced both by administrative measures and an increase in market prices. Administrative influences were: a VAT increase, primarily at public telecommunication services, an increase of consumer taxes for automotive fuels and spirits, and an increase of regulated prices (especially electricity and natural gas). Tobacco, for which consumer tax was also increased, was sold during the entire first quarter from the stock for an unchanged price. Development of market prices was influenced primarily by an increase of food prices, which was the most distinctive in January, while February prices of food slightly decreased after growing for five months and in March they slightly increased.
Acceleration of month-on-month growth led to a year-on-year increase of prices in the first quarter of 2004 by 2.3%; market prices increased by 1.5% and prices influenced by administrative changes by 5.2%. The influence of market and administrative prices on total year-on-year increment of prices was almost the same (1.1 and 1.2 percentual points).
Development of market prices was influenced primarily by prices of food , at which the acceleration of y-o-y price growth continued (especially in January). It applied primarily to prices of meat, which grew by 2.2%; pork went up 3.3% and poultry +8.6%. Prices of bread and cereals also distinctively grew (+10.8%); prices of rolls and bagels grew by 31.8%, flour +11.6% and bread +8.8%. Price growth acceleration occurred also at eggs, milk, cheese, oils and fats, and sugar. Price growth of food was influenced, although less than in the fourth quarter of 2003, also by seasonal prices of fruit, fresh vegetables and especially potatoes, the prices of which were higher y-o-y by 69.3%. Development of consumer prices of food was in correspondence with the development of prices of agricultural producers and industrial producers of food and beverages, for which the y-o-y growth rates distinctively grew especially in January (at agricultural producers also in February).
Acceleration of y-o-y price growth occurred in the first quarter at housing , which was influenced by an increase of regulated prices of electricity and natural gas from January 2004. Electricity prices, which were due to two decreases lower during the entire 2003 than in 2002, increased from January y-o-y by 3.5%. Prices of natural gas increased in January 2004 month-on-month by 3.0%, in January 2003 by 4.2%. It led to a decrease of y-o-y growth rate of natural gas to 7.9% (from 9.1% in the fourth quarter of 2003). Prices of heat slightly grew (from 1.9% in the fourth quarter of 2003 to 2.6% in the first quarter of 2004).
Distinctive price growth occurred in the first quarter in postal services and telecommunications , which was caused by an increase of VAT for public telecommunication services from 5 to 22%. On the other hand, prices of mobile phones continued to decrease.
Similarly, development of transport prices was influenced primarily by an increase of prices of automotive fuels in January as a result of a higher consumer tax. In March another month-on-month price increase occurred. Despite the increases, prices of automotive fuels remained in the first quarter of 2004 y-o-y by 0.5% lower than in the corresponding period of 2003. At domestic producers of refined petroleum products prices decreased in January and even more decreased in February. Similar development was observed also at import prices of mineral fuels and mineral oils.
Year-on-year decrease of prices in recreation and culture was caused primarily by a decrease of prices of recreational stays abroad by 4.2% and domestic recreational stays by 1.1%. A slight decrease of prices continued also at equipment for the reception, recording and reproduction of sound and pictures.
Price growth in health was caused primarily by higher prices of pharmaceutical products (+ 3.1%) and outpatient medical services (+5.0%). Seasonal winter prices of therapeutic stays at spas were lower by 6.6%.
In restaurants and hotels the growth of food prices resulted in an increase of prices of catering services by 2.5% (from 1.8% in the fourth quarter of 2003).
Prices of goods in total (after stagnation in the fourth quarter of 2003) grew by 1.4%, prices of services increased by 4.0%. Growth of prices of services was influenced in the first quarter of 2004 primarily by an increase of prices of telecommunication services due to the higher VAT.
Harmonized index of consumer prices in the EU15 and Acceding Countries
The average year-on-year increment of the harmonized index of consumer prices (HICP) for the EU15 had a slightly decreasing tendency since December. In February it was 1.5% (in November 2.0%), which is the lowest value for the last 12 months. Similar development was observed in most of the countries with the exception of Luxembourg, Austria, Portugal and the United Kingdom. At Acceding Countries the HICP increment had a decreasing tendency only at Cyprus, Estonia, Slovenia and Slovakia. In the Czech Republic, on the contrary, after a long-term low level of HICP, the end of the year 2003 and the beginning of 2004 saw price growth acceleration. The year-on-year increment of HICP in the Czech Republic reached 2.0% both in January and February and thus it got above the average of the EU15.
