CPI inflation speeds up to 0.9% y/y in BiH

CPI inflation accelerated to 0.9% y/y in February from 0.3% y/y the month before, according to the latest data by BiH statistical office. In monthly terms, consumer prices increased by 1.0% after 0.2% m/m rise in January.

The main upward pressure on the headline inflation acceleration came from transport prices, the growth of which accelerated to 5.7% y/y in February from 0.9% y/y the month before with the increase of fuel prices resulting from the entry into force of the excise tax changes. Utility-related as well as alcoholic beverages and tobacco prices also had a positive contribution to the headline inflation acceleration in the month, albeit a minor one. Electricity prices for households in both entities will remain unchanged this year. Only in FBiH electricity prices for some business customers increased by 3.6% as of Apr 1 — the price hike refers to 3,500 medium-sized commercial customers or just about 5% of all customers. A downward pressure on the headline inflation change in February came only from food and non-alcoholic beverage prices.

Consumer prices increased by 1.3% y/y in 2017. The IMF sees CPI inflation at 1.6% in 2018, whereas local authorities expect consumer prices to rise by 1.2% this year.

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