Finance Ministry cuts 2011 inflation estimate

Finance minister Ivan Miklos has announced a cut in his ministry’s inflation estimate for next year.

The ministry reduced its 2011 projection of 3.7% inflation down to 3.3% thanks mostly to milder energy price hikes and better price development than expected. The government’s thwarted plan to increase excise tax on beer also played a role in the lower estimate.

Regarding energy prices, the regulatory authority URSO increased gas prices in the regulated segment by less than thought, while electricity prices will be higher than forecast. Altogether, though, the decisions of the regulator accounted for 0.2% of the drop in inflation for next year.

Under the latest projection of 3.3%, households could be paying some EUR 28 a month more in basic expenses in 2011.

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