Inflation remains stable in September

Latest reading: Consumer prices increased 4.3% on a year-on-year basis in September, remaining stable for the third consecutive month and above the ceiling of the Central Bank’s 2.0–4.0% target range. September’s figure was in line with market expectations. Relative to the previous month's figures, there were higher price pressures for clothing and footwear (+0.9% on a year-on-year basis vs -0.4% in August) and transport (+2.1% vs +0.1% in August). In contrast, there were reduced price pressures for food and non-alcoholic beverages (+3.0% vs +4.7% in August) and housing and energy (+8.0% vs +8.5% in August). Meanwhile, core consumer prices were up 3.9% in annual terms in September, stable from the previous month's reading. Finally, consumer prices were unchanged in September in month-on-month terms, following a flat reading in the previous month.

Panelist insight: ING’s Peter Virovacz and Zoltán Homolya said: “Looking ahead, the inflation rate may rise in the coming months due to base effects. Where exactly it will peak depends largely on the outcome of the mandatory price shield measures. Our inflation forecast of 4.6% for this year remains unchanged. […] In light of this, the strict monetary policy stance and the unchanged base rate are certain to remain in place in the short term. At the same time, there is an increasing chance that the benchmark rate will remain at 6.50% for most, if not all, of 2026. This is because the Hungarian economy may experience shocks over the next one or two years that carry clear inflationary risks. Examples include government-driven demand stimulus affecting households' financial situation, the elimination of margin freezes, the end of voluntary price caps, and a double-digit increase in the minimum wage each year for the next two years.”

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