Warsaw (Puls Biznesu) – Prices in July did not fall in July. Analysts were surprised.
Economists were surprised with yesterday’s publication of the central statistical office GUS. Prices in July did not grow 0.8 percent year on year but by 1.1 percent. They remained unchanged on the monthly basis.
“It is a big surprise. It happens very rarely that the data exceed not only the median but also the whole range of forecasts”, Marcin Mroz, Fortis Bank chief economist commented.
Before the data were published, economists feared that the drought would adversely affect food prices.
“It turned out that the prices fell by 1.2 percent month on month, the way it usually happens in summer. But there was a big surprise as far as communication, entertainment and culture prices are concerned. Hadn’t it been for these elements, inflation would fall by 0.3 percent in July”, Katarzyna Zajdel-Kurowska, Bank Handlowy chief economist said.
In July, due to higher prices for internet services, communication prices grew 1.9 percent. Entertainment and culture prices rose 3.4 percent, which was caused by a 5.3 percent increase of digital and cable TV services or 3.2 percent jump in tourism.
Bartosz Pawlowski, ING economist, believed that there is no necessity to raise interest rates.
“Inflation is still below the target (2.5 percent plus minus 1 percentage point). But it will probably change at the end of this year”, ING economist said.
There were positive data published concerning the labor market – employment rose 3.3 percent and wages 5.6 percent.