Last month, Czech consumer prices saw their biggest drop in over a decade

Consumer prices in the Czech Republic saw their biggest month-on-month drop in September 2019 since September 2006, with a decrease of 0.6% compared with August. The year-on-year growth of consumer prices slowed to 2.7% in September, with the increase due largely to housing prices, according to the Czech Statistical Office (ČSÚ).

In the
month-on-month comparison, the decrease in overall consumer price
level in September came mainly from price drop in recreation and
culture, where prices of package vacations went down by 23.6% due to
the end of summer season.

In food and
non-alcoholic beverages, prices of vegetables were lower by 4.5%,
with potato prices dropping by 8.7%. Prices of non-alcoholic
beverages were lower by 1.7%, fruit by 2.0%, and butter by 4.6%.

Not all food prices
went down. Milk, cheese, and eggs went up by 0.6%, bread and cereal
prices were higher by 0.5%, and sausages and smoked meat by 0.6%.

The price increase
in clothing and footwear was influenced by garment prices rising 1.4%
and shoes and other footwear prices by 1.3%. In alcoholic beverages
and tobacco, prices of spirits were higher by 1.1% and wine by 1.2%.
In restaurants and hotels, prices of catering services increased by
0.8%.

Education was also
more expensive, with higher education rising the most. As the new
school year started, prices in education overall rose by 3.7%. Fees
in kindergartens increased by 3.1%, tuition fees at private secondary
schools by 4.1%, school fees at public universities by 10.1%, fees
for foreign language learning by 2.1%, fees in basic art schools by
1.9%, and fees in after school care centers by 3.2%.

Prices of goods in
total remained unchanged compared with August and prices of services
went down by 1.3%.

In the year-on-year
comparison, in September consumer prices increased by 2.7%, which is
0.2 percentage points down from August. A
slowdown in the year-on-year price growth occurred mainly in
food and non-alcoholic beverages, where vegetable prices rose by
11.7% in September (compared to 34.1% year-on-year in August).

Egg prices were
lower by 13.2% in September (10.4% in August), oils and fats by 10.0%
(4.3% in August), fruit by 7.4% (4.9% in August).

A slowdown in the
year-on-year price growth also occurred in recreation and culture,
due to prices of package vacations, which rose by 6.0% in September
(7.8% in August).

Price development in
transport was influenced mainly by prices of transport services,
which turned from a decline by 7.1% in August to the growth by 0.9%
in September. The main reason was their strong month-on-month price
drop in September 2018 due to the introduction of nationwide fare
discounts in bus and rail transport.

The biggest
influence on the growth of the year-on-year price level in September
came again from prices in housing, water, electricity, gas and other
fuels, where prices of actual rentals for housing went up by 3.8%,
water supply and sewage collection identically by 2.6%, electricity
by 9.9%, natural gas by 3.6%, heat and hot water by 5.1%.

Next in order of
influence were prices in food and non-alcoholic beverages, where
prices of sausages and smoked meat were higher by 7.6%, yogurts by
6.0%, and potatoes by 40.3%.

Increases were also
seen in restaurants and hotels, where prices of catering services
increased by 5.1% and prices of accommodation services by 3.0%.

A year-on-year drop
in September price levels came again on clothing and footwear due to
prices of garments dropping 3.3%. Communication prices dropped by
1.6%.

Prices of goods in
total and services went up 2.0% and 4.0%, respectively. The overall
consumer price index excluding imputed rentals for housing was
102.5%, year-on-year.

The inflation rate,
that is the increase in the average consumer price index in the 12
months to September 2019 compared with the average CPI in the
previous 12 months, amounted to 2.6%.