Hungarian headline inflation slowed to an annual +3.8% in January from +5.5% in December, below analysts' expectations of +4.4%, the Central Statistics Office (KSH) said on Friday. Core inflation slowed to +6.1% in January from +7.6% in December, below a +6.4% forecast in a Reuters survey. Prices increased by 0.7% on average from the previous month, the KSH said.

Average inflation for 2023 was +17.6%. As of April 2021, the KSH no longer includes alcohol and tobacco prices in its core inflation figure. The National Bank of Hungary targets 3% headline inflation with a tolerance band of a percentage point on either side.

Food prices rose by 3.6% year-on-year, household energy prices fell by 11.3%. Consumer durables prices decreased by 1.4%, with prices of new cars increasing by 1.3%, while services prices rose by 10.4% in annual terms. INFLATION (% change) Jan 2024 Dec 2023 Jan 2023 Headline CPI m/m +0.7 -0.3 +2.3 Headline CPI y/y +3.8 +5.5 +25.7 Core CPI y/y +6.1 +7.6 +25.4 (Reporting by Anna Banacka and Adrianna Ebert in Gdansk; editing by Milla Nissi)