Inflation down to record low, rate cut on the cards

Year-on-year inflation fell in October to a record low of 1.1% and was 0.2% lower than in September. Despite some analysts' claims that a gentle consume r price index (CPI) increase can be expected in the last two months of 2002, the overall figure this year is not likely to exceed the anticipated 1.3%-1.5%. The projected rebound is the result of hig her food and fuel prices. According to the Central Statistical Office, price s have been growing more slowly this year. The fastest growing prices were t hose in the real estate sector at 4.2%, health-care, 3.8% and transport, 3.5%. CPI in food and beverages decreased by 2%. Accordi ng to Janusz Jankowiak, chief economist at BRE Bank, the changes in food pri ces are temporary with the effect partially coming from lower excise duty on alcohol. Lack of price pressure, increased money supply in October and the s trong z oty downgrading import prices should spur the Monetary Policy Counci l (RPP) to consider lowering interest rates by a further 0.5%. (Rzeczpospolita, 16-17 N ov. p. B1; Prawo i Gospodarka, 16-17 Nov. p. 1) J.K.