Inflation reached 8.2% in September and has been decreasing gradually since March

In September, a slowdown in price growth rate continued to be reflected in the most significant components of household expenditures: prices of food currently rose by only 11.3%, housing by 6.5%. However, prices slightly jumped month-on-month, under the influence of increasing school and health fees, prices of services of telecommunication operators, as well as fuel prices.

Inflation  at the year-on-year level, continued its downward trend and declined from 8.9% in August to 8.2% in September. It was prevented from sharper drop due to a month-on-month price increase of 0.3% on average, mainly influenced by the traditional September price increase in education, which was also aditionally supported by the continued rise in the prices of gasoline and diesel, as well as selected services.

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Month-on-month development – September 2023 compared to August 2023

Prices of goods and services increased by 0.3% in September compared to August, which was the result of price increases in 8 of the 12 main monitored divisions (household expenditure groups). The most significant impact was an increase in prices in the field of education by 3.1%. At the beginning of the new school year, consumers had to deal with higher prices for pre-primary and primary education, as well as secondary and language education.

The second most significant impact was an increase in prices in the transport division by 0.5%, which was mainly caused by higher fuel prices by 1.2%.

After the seasonal sales, prices of clothing and footwear also increased month-on-month by 1.2%, in health sector, prices for dentists' services by 2.2%, and prices of telecommunications services (2.6%) and canteens (1.8%) rose more significantly. Higher prices of alcoholic beverages and tobacco by 0.6%, especially beer and spirits, also contributed to an increase in the average price level in September.

Prices in the division of food and non-alcoholic beverages, which has the second largest weight in the expenditure of Slovak households, did not change month-on-month in total, and this was true for their component - food. Prices dropped in most of the 9 food groups (classes). Prices of vegetables mostly decreased month-on-month by 2.3%, as well as milk, cheese and eggs by 0.5% (influenced by a decrease in prices of cheese and yogurt). Compared to August, prices of fruits, oils and fats also declined. On the contrary, prices of bread and cereals, meat, as well as sugar and confectionery, slightly rose.

Prices did not change month-on-month even in the most significant expenditure item of Slovak households, in the division of housing and energy.

The downward trend was recorded only by 2 main expenditure groups – recreation and culture, and miscellaneous goods and services. Prices of package holidays, as well as office and school supplies and prices of personal care were lower than in August.

In September, compared to August, the consumer price index increased by 0.3% in households of employees and also in low-income households, and by 0.2% in households of pensioners.

Year-on-year development - September 2023 compared to September 2022

In September, year-on-year total inflation reached 8.2%. Thus, year-on-year price increases were dampened for the seventh consecutive month. Among the 12 divisions (household expenditure groups), the dynamics of year-on-year price growth decreased in up to 8, except of only 4 divisions, in which month-on-month growth or stagnation in prices of selected goods and services were recorded - in the divisions of transport, alcoholic beverages and tobacco, communications, and also healthcare.

The long-term higher prices of food and non-alcoholic beverages have the greatest impact on overall inflation. The growth dynamics of food prices has been slowing down for the sixth month, in September they were higher by 11.3% year-on-year. The pace of year-on-year growth slowed down in all 9 food components. More than 20% year-on-year price growth remained only for sugar, jam and confectionery.

Compared to September 2022, price growth in housing and energy dropped to 6.5%, the lowest value of price growth since the end of 2021.

Despite the month-on-month price increase, prices of fuels were still lower by 0.6% than a year ago. Price growth in the transport services group was strengthened, reaching the level of 22.5%.

It was prevented from more significant decrease in overall inflation due to an increase in prices in the field of communications, mainly due to an increase in the fees of telecommunications operators to a value of 5.1%. Inflation was similarly negatively affected by a price rise in alcoholic beverages and tobacco division, consumers paid by 9.4% more for them on average than a year ago.

In September 2023, the consumer price index increased year-on-year in households of employees by 8.2%, in low-income households by 8.5% and in households of pensioners by 7.9%.

In total, in the first nine months of 2023, consumer prices reached a year-on-year growth by 12% (households of employees 11.9%, low-income households 12.7%, households of pensioners 12.5%).

Development of core and net inflation

In September, the total annual inflation rate was 8.2%, core inflation reached 8.8% and net inflation reached 8%. On a month-on-month basis, core inflation and net inflation reached the same value of 0.3%.

Core inflation is affected by the price level growth after excluding the impact of changes in regulated prices (e.g. energy prices) and other administrative measures (e.g. tax adjustments, etc.). Net inflation is core inflation without changes in food prices.