Central Statistical Office announced that the price index of consumer goods and services in August 2014 compared to July 2014. Was 99.6. This means that prices decreased by 0.4 percent.
In a year, prices fell in August in about 0.3 percent.
– The biggest impact on the price index of consumer goods and services total in this period were lower food prices (by 1.8 per cent.), clothing and footwear (by 2.7 per cent.), which lowered the index by 0.40 per cent and 0.13 p p percent price increases in communications (by 1.3 per cent.), as well as goods and services related to housing (0.1 percent.) raised the index by 0.07 per cent and 0.02 p p percent – GUS said in a statement.
Commentary by Dr. Margaret Starczewska-Krzysztoszek, main economist of the Confederation Leviathan
For the second time since 1989, we are dealing with the fall in prices on an annual basis (the first was in July.). This is in part the effect of seasonal factors (July, August, September is always a period of lower inflation). But in a much stronger degree of the effect of the Russian embargo on food products with a high this year of harvest. Food prices fell in August y / y 2.3 percent., With a high base from August 2013., 102.8. In the coming months, we should expect a decline in food prices, because to have an impact on food prices of factors of wheat harvest occurs even in the USA.
The decline in food prices has a positive effect on the wallets of Poles, especially those with lower incomes. “Releases” is part of disposable income and theoretically allows them to spending on other goods or services. However, the observed increases in retail sales are not high, which means that households can not always decide on spending “saved” thanks to low income food prices.
Just as in July, if not a change in strategy telecommunications companies concerning pricing and the increase in prices of alcoholic beverages (higher excise) deflation in August would have been much deeper.
The Monetary Policy Council probably will not be able to have doubts as to what decision taken at its October meeting. And all indications are that this year will drop interest rates by 50 basis points. GDP growth was as true in the second quarter of this year. comparable to that achieved in the first quarter, but neither sold production of industry or retail sales in recent months, nor the results of the companies after 6 months of this year. do not allow the establishment of comparable GDP growth in the second half of 2014. And it should also influence the decisions of the MPC.
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