The Czech National Bank’s commentary on October 2026 inflation identified grounds for increased monetary policy caution despite annual inflation easing by 0.1 percentage point to 2.4%. Petr Sklenář, executive director of the Monetary Department, linked the elevated inflation outlook for 2027 to persistent core inflation and global energy and food price pressures.
The October slowdown mainly reflected a deeper decline in food and non-alcoholic beverage prices, which fell 4.0% annually compared with 3.5% in September. Fuel prices also underwent a correction following a reduction in diesel excise duty. Underlying pressures changed little, with core inflation unchanged at 3.1%. Services inflation remained elevated at 4.5%, despite slower growth in the cost of owner-occupied housing, while goods inflation edged up to 1.0%.
Headline inflation is expected to approach 3% by the end of 2026, driven mainly by food prices. It is likely to rise temporarily well above 3% in early 2027 as the administrative effect of transferring the supported energy sources fee fully to the state budget fades. Inflation is expected to peak in February before slowing, while core inflation should remain around 3% in the coming months.