Inflation decelerated from 3.1% in February to 2.8% in March as food prices rose less than in the previous month. Regulated prices of goods and services rose by 7.5% and non-regulated prices by 1.5%, over the year, in March.
Food, alcohol, and housing contributed the most. Milk products and fruits pushed up food prices. Excise tax hikes lifted the prices of alcohol and tobacco. Higher rent and electricity prices resulted in higher housing costs.
Several prices of goods and services decreased, however. Transportation costs came down as flight and bus tickets, and cars (especially used cars) have become cheaper. The prices of motor fuels still grew due to higher excise tax rates and more expensive oil. Crude oil was around 10% more expensive than one year ago (Brent, euros). Tight competition suppressed the prices of clothing and footwear, and communication services.
Inflation should stay around 3.0% in 2018, according to our forecast. Food, alcohol and tobacco should contribute the most.