Hungary’s inflation hits 21.1 pct in October as government caps prices on more food items

Driven mostly by soaring energy costs, Hungary’s annual inflation rate climbed to 21.1 percent in October, the highest since 1996, the country’s Central Statistical Office (KSH) said here on Wednesday.

The highest year-on-year price hikes were registered for energy and food. Food becomes 40 percent more expensive year-on-year, while electricity, gas and other fuels are 64.4 percent dearer — within this category, natural and manufactured gas prices went up by an astonishing 121 percent, according to KSH.

To shield households from soaring costs, the Hungarian government on Wednesday added eggs and potatoes to its list of food products protected by price caps, following price caps in February on sugar, wheat flour, sunflower-seed oil, leg of pork, chicken breast and milk with 2.8 percent fat.

The price caps on energy were removed by the government on Aug. 1, and since then companies and institutions had to pay market prices. The government has also restricted car owners’ eligibility for subsidized fuel in an attempt to ward off shortages.

“Inflation continues its rampage in Hungary,” the local business publication Portfolio commented, “The inflation rate would continue to rise in the coming months, and then it could peak at the end of the year or in the first months of 2023.”

The National Bank of Hungary (MNB) expects this year’s annual inflation rate to be between 13.5 percent and 14.5 percent.

On Oct. 28, Prime Minister Viktor Orban vowed to tame inflation by the end of 2023 to a “single-digit”.

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