In May, Slovakia reached the highest deflation in its history, with pricing falling by 0.8% year-on-year, according to the Slovak Statistics Office. The most significant factor behind the decline is the drop in the price of groceries. It was caused by low prices of oil and a lower VAT for some specific food items. "This form of deflation does not harm the economy. On the contrary, it supports household consumption," said Ľubomír Koršňák, an analyst with UniCredit Bank. He added that inflation could bounce back to positive figures at the end of 2016 when the effect of low cost oil will fade away.
Mojmir Prochazka, Photo: AP/TASR
