Analyst: Inflation Higher in March Due to Higher Prices of Goods and Services

Bratislava, April 15 (TASR) - Inflation accelerated in March, mainly due to higher prices of current goods and services, which were caused by higher value-added tax (VAT) and the planned introduction of the transaction tax, analyst at UniCredit Bank Czech Republic and Slovakia Lubomir Korsnak stated on Tuesday. Food and accommodation services became the most expensive items, while food and fuel prices had a dampening effect on inflation. "We expect that the price hikes, partly under the influence of the new transaction tax, should continue in the coming months. In addition, external factors could continue to affect food prices during the rest of the year, ranging from the spread of infections that have the potential to reduce domestic livestock production to the drought that hit the region during the winter and has the potential to affect part of this year's harvest. By contrast, the pressure on further increases in service prices due to strong salary growth in the economy could gradually fade over the course of the year," said Korsnak, adding that inflation in services will remain at an above-average level as a result of the tax changes. The analyst expects consumer price inflation to accelerate slightly to just above 4 percent in the coming months. Over the whole year, inflation should reach an average of 4.1 percent. am/df