NBS: Price Growth Slows in March Due to Significant Drop in Food Prices

Bratislava, 31 March (TASR) - According to a flash estimate of inflation measured by the Harmonised Index of Consumer Prices (HICP), the overall price level remained unchanged in March, but this pushed the year-over-year inflation rate down to 3.7 percent, said analyst at Slovakia's central bank (NBS) Branislav Karmazin, on Tuesday, adding that compared to the expectations of the spring forecast, it was lower by roughly half a percentage point, mainly due to food prices. "Food prices, along with tobacco products - which Eurostat doesn't report separately in its flash estimate - deepened the previous significant month-over-month decline in March. After a 0.6-percent decline in February, they fell by as much as 1 percent in March, marking the largest monthly drop in food prices in March since joining the eurozone," said the analyst. According to Karmazin, two consecutive monthly declines in food prices likely offset the significant price increases seen at the beginning of the year. "Another explanation for the atypical March trend could be more significant pre-Easter price adjustments. From a historical perspective, the first three months thus brought atypical, even extreme, price fluctuations," he added. Despite the decline in March, NBS expects food price growth to accelerate in the coming months to levels closer to the spring forecast, mainly due to higher agricultural commodity prices and the transfer of higher energy costs to consumer prices. The attack on Iran, which caused a sharp rise in energy commodity prices, has so far had a smaller impact on inflation than in neighbouring countries or other eurozone members. Energy prices in Slovakia rose by 0.7 percent in March compared to February, according to a flash estimate, likely as a result of the government's efforts to curb fuel price increases. Petrol and diesel prices thus don't yet fully reflect the disruption in oil supplies on global markets caused by the ongoing conflict in the Persian Gulf. According to European Commission data, current prices at petrol stations are, on average, lower than in neighbouring countries. am