NFSC also forecast that the consumer price index (CPI) in 2016 will be 3.5-4 per cent if the price increase for health and education services in the last six months of the year is excluded.

NFSC statistics showed that core inflation (excluding food, energy and commodities managed by the State but including health and education services) remained stable at less than 2 per cent in the first seven months of the year.

After rising for six consecutive months, the cyclical inflation component no longer increased as fast as it did in the previous period and started moving sideways, indicating that the influence on CPI of the old price cycle (health services, education, food) would stabilise in the coming months, NFSC said.

According to the General Statistics Office, the monthly CPI consecutively increased year-on-year since November 2015 but stopped rising in July 2016. CPI grew by 2.39 per cent in July, lower than the 2.4 per cent growth registered in June.

Besides this, the CPI in July 2016 rose by 2.48 per cent from the beginning of the year, mainly due to the increase in public services, with health care up 1.32 per cent and education up 0.14 per cent. The increase in public services accounted for up to 56 per cent of the total CPI growth since the beginning of the year.

During the period, food and foodstuff rose only 0.1 per cent and 0.58 per cent, which contributed only 3.9 per cent and 22.1 per cent, respectively, to the general CPI .

Besides this, thanks to basic elements, including aggregate demand and production costs, that continue to be stable, the long-term inflation component still remained low, the NFSC said. 

VNS