Albania’s consumer prices rose 2.3% y/y in April 2013, slowing down from a 2.4% annual rise in March, the statistics institute, INSTAT, said on its website. The growth, however, was above the 1.6% y/y rate recorded in April 2012.

In monthly terms, consumer prices edged down 0.1% in April after rising 0.3% in March.

Food prices increased by an annual 5.7%, accelerating their growth for a fifth consecutive month. The growth was mainly driven by a 28.3% rise in vegetable prices and an 8.1% y/y increase in prices of fruit. Prices of alcoholic beverages and tobacco went up 3.5% y/y in April after advancing 3.6% y/y in the previous month.

Communications and education services costs grew by 1.3% and 1.8% y/y, respectively, advancing at the same pace as in the previous three months. By contrast, lower prices of clothing and footwear (down 3.4% y/y) continued to exert downward pressure on the inflation.

Regulated prices registered a 0.9% y/y drop in the month. Moreover, costs of transport reversed to a 0.3% y/y decline, which resulted from a 1.2% y/y drop in the prices of equipment operations of personal transportation. In our estimates, the average inflation rate was equal to 2.5% in January to April 2013, up from 1.2% in the same period of 2012.

The central bank decided on April 30 to keep the base interest rate at its historic low of 3.75% for a third consecutive month after cutting it by 25bps in January. The decision is in line with the objectives to meet the mid-term inflation target, while providing necessary stimulus to support lending growth and consumption.