September CPI moderately below expectation

HUNGARY - In Brief 07 Oct 2026 by Istvan Racz

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As reported yesterday, the median analyst expectation for September headline CPI-inflation was 1.8% yoy, up from 1.3% in the previous month. But the actual figure was 0.2% mom, 1.6% yoy only. Fuel prices indeed rose 5.9% mom, maybe a bit less than expected, but non-fuel inflation was actually -0.2% mom, bringing down the yoy rate to 1.4% from August's 1.6%. Last time we saw non-fuel inflation in the negative range in September was in 2020, the main Covid year. Further good news was a decrease by core inflation to 1.9% yoy from 2% yoy in August. So at least the gap between headline and core narrowed. Importantly, food prices fell 0.1% mom, and service prices dropped by 0.5% mom. Even though food prices also decreased in September 2025, this was cyclical, rather than seasonal in any of the last two Septembers. Decreasing or at least contained service prices are not unseasonal at all, given the usual decreases in the area of travel-related services after the summer tourism season. Food and services represent 56% of the whole CPI basket. Now, is this result a reason to reconsider if early monetary loosening could still be a viable option? No, we hardly believe so. The thing is that there is still some fuel price increase unaccounted for from the August-September period (6.5% accounted for by KSH in this period against 8.6% recorded at gas stations by Holtankoljak.hu, and in the first week of October, retail fuel prices rose by a further 2.2% according to the latter source. Please, also note MOL's apparent efforts to contain the pass-through of rising oil import prices and a somewhat weaker forint into domestic fuel prices over recent weeks. This is workable in short term, ...