Inflation in Bulgaria Up 0.4% in July 2010 M/M

Bulgaria registered once again an inflation of 0.4% on monthly basis in July, after a relatively short period of stability, data published Thursday by the National Statistics Institute (NSI) reveals.

The annual inflation is up 2.4% and was 1.4% in June, 2010.

The higher prices were triggered by cost increase of fuels, electric power, water and gas.

Inflation is up 1.9% since the beginning of the year – January – July, 2010.

If EU standards are used, inflation is even higher – 0.5% on monthly and 3.2% on annual basis.

Prices of all goods, with the exception of food and non-alcoholic beverages, went up on monthly basis. Food and beverages are, however, about 35% of the average household expenditures in Bulgaria. From month to month the price hike is higher for leisure and vacations – 4.7%, and 1.2% for fuels, electric power, water and gas.

On annual basis, prices are up the most for alcohol and tobacco products – a staggering 27%, but they form about 5% of the household expenses while price of food is down 1.2% compared to last July.

June ended with a 0.9% deflation on monthly basis, but in March, April and May, inflation had a steady trend of going up and reached 1.9%.

Inflation traditionally goes down in the summer over lower prices of produce and grain, but in July 2010 the trend is the opposite with increase of grain price.

The cabinet’s forecast is for the inflation to reach 3.2% by the end of the year while the International Monetary Fund forecasts 2.2%.