Latvian inflation accelerates in September

Latvian inflation accelerates in September
By bne IntelliNews October 10, 2016

Latvia's consumer price index (CPI) expanded 0.6% y/y in September, data released by the Central Statistical Bureau (CSB) on October 10 showed.

The reading comes after July and August saw the CPI stabilise following deep falls since the start of the year. That makes September the third month in a row that the index has evaded deflation. In monthly terms prices grew 0.5% in September, in contrast to a fall of 0.7% seen in August. 

As has been standard recently, it was price falls in the transport sector - last month by 2% y/y - that proved the main drag on the headline index. Prices in the clothing and footwear segment also declined, by 1.8%.

Those falls were balanced by rises in most other segments. The communication segment enjoyed the biggest gain of 2.8%. Food prices grew also fairly fast, at 1.9%, against just 0.5% in August.

Latvian inflation is set to continue its gains as commodity prices recover. For 2016, Swedbank forecasts average annual inflation at 0%. The European Commission forecast in the spring that Latvian CPI will rise 0.2% through the full year.