Business News

Annual Inflation at 2.1%, Deflation at Monthly level (II)

Ljubljana, 30 July (STA) - Slovenia's inflation rate rose by 0.2 percentage points to 2.1% at the annual level in July, even though consumer prices fell by 0.7% at the monthly level, according to official statistics.

Measured with the harmonised index of consumer prices, an EU benchmark, the annual inflation rate was 2.3%, while the 12-month average price growth was 1.6%, the Statistics Office said on Friday.

Contributing most to monthly deflation were summer sales, which pushed the prices of clothing and footwear down 15.9% in July. The fall contributed 1.3% to monthly deflation.

The prices of second-hand cars fell by 4.0%, while the prices of telephone services and equipment decreased by 1.5% on account of new discounts. Each contributed 0.1 percentage points to deflation.

At the annual level, prices dropped in the groups clothing and footwear (by 2.1%), transport (by 1.2%) and recreation and culture (by 0.6%).

July saw a 10.7% hike in the prices of package holidays, which pushed the prices in the group recreation and culture up by 3.1%.

Dental services were dearer by 8.2%, while prices of electricity, gas and other fuels rose by 1.%, gas and heat energy prices went up by 2.2% and liquid fuel prices rose by 2.1%.

Contrary to expectations, the prices of seasonal food products increased; fruit was costlier by 3.2%, fish by 2.6% and vegetables by 2.3%.

Alcoholic beverages were more expensive too. Beer prices rose by 1.7% and process of spirits by 1.3% due to higher excise duties, while wine prices rose by 1.7% as special offers ended.

At the annual level, prices increased most in the group housing, water, electricity, gas and other (12.4%), alcoholic beverages and tobacco (5.2%), health, and food and non-alcoholic beverages (2.8%) and education (1.9%).

Commenting on the statistics, the Institute of Macroeconomic Analysis and Development attributed monthly deflation to the seasonal trend in the prices of clothing and footwear, while it said the annual inflation rate reflected low economic activity.

Consumer prices were also affected by excise duties, the exchange rate of the euro against the US dollar, and global prices of energy products, the government think-tank said.

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