Several government measures combined have halved the inflation of food prices compared to its previous peak, government spokesperson Alexandra Szentkirályi announced on public Kossuth radio on Sunday.
Szentkirályi stated that the cabinet applied appropriate tools to curb inflation, which, as evident from the numbers, has received a ‘punch in the gut and fallen to its knees.’ However, the struggle is not yet over, and the goal remains achieving a single-digit inflation rate.
There is a good chance that this goal could be achieved as early as October, rather than the originally expected end of the year, the government spokesperson suggested. She noted that inflation decreased to 17.6 per cent in July, representing a 2.5 per cent decrease compared to the previous month, and a 0.9 per cent decrease in food prices. On an annual basis, the combined effect of multiple government measures has practically cut the inflation of food prices in half compared to its peak. The cabinet aims to further encourage this process.
Regarding the discontinuation of the price freeze in early August, Szentkirályi mentioned in response to the programme host’s question that this measure has forced major multinational supermarket chains to lower prices. Among the 62 product categories, the price-reducing effect is already visible in 52 categories. A fiercely competitive environment has emerged in stores, and as of 9 August, average prices for these product groups have decreased by an average of 6.5 per cent, with even greater percentage reductions in some categories, she emphasised. She pointed out that vegetable prices have decreased the most. For instance, the average price for ware potatoes has decreased by over 45 per cent, that of bell peppers by 37 per cent, and eggs are now 27 per cent cheaper.
The continuous price competition, driven by government measures, is very effective, and customers are evidently making use of the tools provided by the government, she highlighted. Since the launch of the online price monitoring system, it has registered over a million unique users. Szentkirályi noted that people are using the system in a conscious way, keeping an eye on promotions. Thus, it is not only the authorities but also the consumers who penalise stores with excessively high prices as people simply go to other retailers in response. ‘Now it’s not the multinationals, but the people who need help, so we won’t allow the multinationals to profit. Further measures are in the pipeline, including in the realm of online price monitoring,’ she expressed.
Addressing the mandatory discount system introduced in early June, Szentkirályi informed that by early August, inspectors had examined 642 stores, finding minor violations in over ninety instances, meaning that some form of irregularity was found in about ten per cent of the stores. In most cases, price reductions or promotional products were not properly displayed. In other cases, the regulations regarding promotions were simply not adhered to, the government spokesperson reported. She added that the total value of fines issued so far reached 25 million forints, a significantly lower figure than the fines imposed during price freeze checks, which exceeded three billion forints.
Referring to this, Szentkirályi mentioned that the price freeze will be reintroduced between 18 and 20 August, during the St Stephen’s Day celebrations, allowing items like mineral water, beer, and pretzels to be purchased at fixed, reasonable prices at designated selling points.