SEPTEMBER'S PRICE MOVEMENT CALLS FOR CAUTION - CENTRAL BANK

SEPTEMBER'S PRICE MOVEMENT CALLS FOR CAUTION - CENTRAL BANK ZAGREB, Oct 9 (Hina) - Croatia's central bank believes price movement undoubtedly calls for constant monitoring in order to take timely and appropriate monetary policy measures if needed. September's price movement was strongly affected by the past summer tourist season, while the possible effects of early October's increase in the price of electricity call for additional caution, the Croatian People's Bank (HNB) told Hina on Monday to an inquiry about the latest data on retail price movements. The State Bureau of Statistics said today retail prices in September rose by 1.2 percent against August. Statistical sources say retail prices in September were 6.6 percent higher than last December and 7.1 percent higher than last September, said the HNB. In this year's first nine months, they were an average 5.7 percent higher than in the same period in 1999. The HNB reiterated its estimate that the said growth in prices was mainly the result of external factors, like more expensive oil, and tax changes, and that if this had not occurred the price growth would have been about 50 percent lower. Commenting on an article run by a daily paper today saying "inflation in Croatia has reached 15.5 percent," the HNB refuted it as unfounded and inexpert. Taken out of the trend, the monthly indicator alone is irrelevant for making far-reaching conclusions and forecasts, the bank said. The inflation rate would be 15.5 percent if price growth every month in the year equalled September's. According to these calculations, data on price growth in August would indicate a zero annual inflation rate, sources at the HNB told Hina. (hina) ha jn