CR´s official inflation at 2.6%, perceived rate at 3.9% in 9 yrs


30.01.2014 12:57

Prague - Czech annual inflation measured by statisticians reached 2.6 percent on average in the past nine years and inflation perceived by consumers was 3.9 percent, UniCredit Bank chief economist Pavel Sobisek told journalists today referring to the bank´s calculations.


Mladá žena drží v dlaních hromádku mincí, peníze, česká měna, koruna - ilustrační foto. ČTK Horázný Josef, Štěrba Martin, Fotobanka ČTK

In December last year, the actual rate was 1.4 percent and perceived inflation 2.5 percent.

Rising prices of energy for households and introduction of health care payments are to blame for the difference in the two rates.

"The index of perceived inflation is measuring price movements as felt by ordinary people but at the same time it is an objective measure," Sobisek said.

UniCredit Bank estimates that the official annual inflation rate will start below 1 percent this year and the weaker crown due to the central bank´s interventions will push it up beyond 2.5 percent in December. Average inflation will be 1.9 percent in the current year.

"Based on German experience I expect that perceived inflation in the Czech Republic will in the long run be more often higher than the actual rate," said Sobisek.

Falling energy prices may, however, cut down the difference this year, according to him.

The index of perceived inflation was introduced in the first countries that adopted the euro. UniCredit in Germany used the index to find out if the single currency did cause a bigger price hike than stated in official statistics.

UniCredit Bank plans to measure perceived inflation each month at the time when the Czech Statistical Office (CSU) makes public the actual rate.

UniCredit Bank will use items whose weight in the shopping basket of the CSU is 46.1 percent. Food items and non-alcoholic beverages, for instance, have a weight of 32.5 percent in the index of perceived inflation while in the official statistics their weight is 15 percent. Energy´s weight is 21.5 percent in the former index and 9.9 percent in the latter index.

Perceived inflation is more volatile as a result, said Sobisek.

Sobisek pointed out that purchasing power of Czech households has been rising. Inflation reached 47.7 percent in the past 16 years while average wage soared by 112 percent.

Health care, alcohol and tobacco, housing and energy are showing the biggest price rises.

consumer price index (CPI)index of perceived inflation (IPI)
January 20123.56.5
February 20123.76.8
March 20123.87.3
April 20123.56.7
May 20123.26.2
June 20123.56.5
July 20123.15.8
August 20123.36.1
September 20123.46.4
October 20123.46.2
November 20122.75.1
December 20122.44.2
January 20131.93.4
February 20131.73.1
March 20131.72.8
April 20131.73.0
May 20131.32.3
June 20131.63.1
July 20131.42.8
August 20131.32.6
September 20131.01.9
October 20130.91.5
November 20131.11.6
December 20131.42.5

Source: CSU, UniCredit Bank

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