Estonian inflation puts in September surge

Estonian inflation puts in September surge
By bne IntelliNews October 7, 2016

Estonia's consumer price index (CPI) expanded 1% in annual terms in September, data from Statistics Estonia showed on October 7. As in the previous month, the country's new excise duty on alcohol and tobacco products contributed to the price growth.

The reading sees CPI in positive territory for a second consecutive month after deflation dominated between May last year and July. Harbingers of deflation coming to an end were seen in through the summer, however, as prices dropped increasingly more slowly until expanding 0.3% in annual terms in August.
In monthly terms, consumer prices inched up 0.2%. The main driver of the inflation in September were prices of alcohol and tobacco products, which rose 8.5% owing to the new excise duty, Statistics Estonia notes.

Prices in the transport sector grew 0.7%, including a diesel price gain of 5.2% and petrol's 1.2% hike. Food prices grew 0.9% and clothing and footwear 3.6%. Heat prices fell 9%.

Estonian CPI is predicted to finish the year at 0.8%, according to the European Commission’s spring economic forecast, while the International Monetary Fund is more cautious with  forecast of 0.5%.

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