Analysts: Food Prices in January Grew M-o-M Most Significantly since 1997

Bratislava, February 14 (TASR) - The most considerable month-on-month increase in January was recorded for prices of food and non-alcoholic beverages, namely by 2.2 percent, with food prices going up in the first month of this year most significantly on a monthly basis since 1997, said analysts, adding that food prices were higher than expected, mainly as a result of continuing growth in meat prices on the world market. Food prices with reduced VAT in January 2020, after adjusting for the effect of the change in indirect taxes, increased significantly by 7.6 percent month-on-month, stated analysts from the currency, statistics and research department (UMS) of Slovakia's central bank (NBS) in a commentary on inflation. Thus, the lower VAT on selected foods has not yet been fully reflected in their prices. However, according to UniCredit Bank analyst Lubomir Korsnak, this was expected. "Other factors affecting the rise in food prices are more dominant and ultimately 'only' result in a slower rise in food prices after the measure has been put into practice. On the other hand, it should be said that January is, as it were, typical of a month-on-month rise in food prices, and this is repeated almost every year," added WOOD & Company analyst Eva Sadovska. According to Korsnak, the dynamics of the year-on-year growth in food prices moderated from 5.2 percent to 4.4 percent, mainly due to a stronger base effect "when food prices were boosted at the beginning of last year by the eventually scrapped special levy for retail chains". According to Sadovska, various other factors have been affecting food prices in recent months, such as African swine fever virus that has an impact on higher meat prices, as well as salary expenditures related to bonuses for work at night and weekend, and also the minimum wage growth. am