Economy 18 January 2023, 12:03pm

Hungary Dec22 inflation higher than anywhere else in EU by far

Portfolio

Hungary's inflation at 25% was again the highest in the European Union in December 2022, as expected, data by Eurostat, the statistical office of the EU, showed on Wednesday. Moreover, the Hungarian inflation rate is by far the highest on the continent, with only Latvia and Lithuania having annual rates above 20%.

Last week, the Central Statistical Office (KSH) reported that inflation continued to rise in December, reaching 24.5% yr/yr. This was a moderate surprise to the downside, as analysts' consensus estimate in a Portfolio survey came to 25.8%.

However, it was already foreseeable after the publication of the data that, as in November, the Hungarian inflation rate was again the highest in the European Union. While most countries have already seen a reduction in price pressures, the CPI in Hungary rose from 22.5% to 24.5% due to the abolition of the fuel price freeze.

Eurostat data released on Wednesday also confirmed this preliminary view. The Harmonised Index of Consumer Prices (HICP) used by the EU's statistical office was 25% in Hungary, while the second highest figure in Latvia was 20.7% and the third highest in Lithuania was 20%.

In the region, Czech inflation was 16.8% in December, while Polish inflation was 15.3%. The pace of price increases in Slovakia, Bulgaria and Romania was even lower. The lowest inflation rates in Europe were recorded in Spain, Luxembourg and France.

If we look at the monthly change, only the Swedish price increase of 2.1% was higher than the Hungarian one. In the EU, only ten countries recorded increases, but of these only Sweden and Hungary had m/m increases of more than a full percentage point.