Latvia's consumer price index (CPI) grew 2.9% y/y in September, data released by the country's Central Statistical Bureau (CSB) on October 9 showed.
The reading means price growth slackened following August’s 3.1% y/y growth rate. Price growth appears to be driven by the tightened labour market pushing up wages and the return of EU-funded investment, which exert demand-led price pressure.
Inflation has now grown for 13 months straight, in line with forecasts for a decisive pick-up in CPI this year after the index barely moved in 2016.
In monthly terms, prices grew 0.3%, compared to a fall of 0.2% the previous month. All but two segments recorded annual price growth in June.
Prices in the food segment were the main driver behind the headline figure, growing 5.5% y/y. Prices in the transport segment also contributed, expanding 3.2% on the year in September.
The CPI is expected to grow by 2.2% in 2017, according to the European Commission. Swedbank is a tad less conservative, predicting prices will grow 2.5%. The index added just 0.1% last year.