Latvia's consumer price index (CPI) kicked off 2018 with a growth of 2% y/y in January, data released by the country's Central Statistical Bureau (CSB) on February 10 showed.
The reading means price growth slowed down from the 2.2% y/y growth rate seen in December. Still, price growth appears to be under moderate demand-led pressure from the tightened labour market pushing up wages; the return of EU-funded investment also plays a role.
Inflation has now grown in y/y terms for 17 months straight, having not fallen below the 2% mark since December 2016. That is in line with forecasts for a decisive pick-up in CPI in 2017 and 2018 after the index barely moved in 2016.
All but three segments recorded annual price growth in January. Prices in the housing segment were the main driver behind the headline figure, growing 3.2% y/y. Prices in the food and non-alcoholic segment also contributed, growing 1.9% y/y in January,
Another important driver, the transport segment, saw prices grow 1.9% y/y. Prices declined in the clothing and footwear, furnishings, and education segments.
In monthly terms, prices did not change, repeating performance from December and marking the third month in a row when m/m inflation hardly changed; CPI inched up just 0.1% m/m in November.