February 5 (SeeNews) - Erste Group expects Croatia's average inflation to modestly accelerate in 2018 close to 1.5%, compared to 1.2% seen in 2017, the Serbian unit of Erste said on Monday.
"Croatia's inflation should peak at the beginning of the third quarter at a level close to 2% y/y, and afterwards revert to a downward trajectory, moving below 1.5% y/y towards YE18", Erste Group noted in a CEE inflation report sent to SeeNews.
Demand side pressures are seen to remain modest, though likely gaining some traction in comparison to 2017, supported by consumer confidence and disposable income developments.
"The somewhat weaker USD provides some resilience against potentially increasing oil prices, while, as far as food prices are concerned, we see the risks as fairly balanced, hence seeing the overall risks to our CPI forecast as balanced as well," Erste said.
Croatia's central bank said in December is expects inflation of 1.6% in 2018.