Entries RSS Feed Share Send to Facebook Tweet This Accessible version

Inflation slows down, but vegetable prices surge

August 10th, 2019

A left-wing analyst criticizes the National Bank for not raising the base rate despite the high inflation rate. Other economists think that higher prices are the natural result of increasing wages and a higher demand for higher quality goods.

According to the latest report of the Central Statistical Office, inflation was 3.3 per cent year-on-year. While the inflation rate slowed from the previous 3.9 per cent, it is still the second highest in the EU. Food prices rose by 12.7 per cent, as a result of the 31 per cent surge in vegetable prices.

Népszava’s Miklós Bonta criticizes the National Bank for its loose monetary policy. The left-wing analyst recalls that the National Bank said earlier that it would raise the base rate if the inflation rate reaches 3 per cent. But despite the current higher inflation, the National Bank did not intervene to maintain price stability, Bonta notes. All this, he believes, harms the interests of poor Hungarians including pensioners, who do not benefit from higher wages but need to pay more for housing and food.

In Magyar Nemzet, Csilla Köpöncei cites economists who explain higher vegetable prices with lower supply in Europe and higher wages in Hungary. The pro-government commentator suggests that producers can finally offer more decent salaries to manual field workers as vegetable prices go up.

In Világgazdaság, agricultural analyst Zoltán Flórián explains steeply increasing vegetable prices with higher demand for higher quality produces and higher production costs. As agricultural producers need to meet higher standards, prices naturally rise, Világgazdaság argues.

Tags: , ,