The Czech Republic’s annual inflation rate showed a modest decline in February, dropping to 2.7% from January’s 2.8%, according to preliminary estimates from the Czech Statistical Office (ČSÚ). The month-on-month consumer price increase was recorded at 0.2%, with final figures expected to be released next Tuesday.
Food, alcohol, and tobacco prices led the year-on-year increases, climbing by 4.7%, matching the rise in service costs. Meanwhile, energy prices continued their downward trend, decreasing by 3.6%.
BH Securities’ chief economist Štěpán Křeček warns of persistent inflationary pressures in the food sector, citing January’s 9% surge in agricultural producer prices as a concerning indicator. While the plant production sector might see improvements with the upcoming domestic harvest, the livestock sector faces more complex challenges.
Despite these mild increases, inflation remains safely within the Czech National Bank’s tolerance band. However, potential trade wars looming over the European Union present a new uncertainty for future economic stability.