Lithuanian inflation maintains steady pace in September

Lithuanian inflation maintains steady pace in September
By bne IntelliNews October 10, 2016

The Lithuanian consumer price index (CPI) grew 0.8% y/y in September, retaining the same pace of expansion as the previous month, data released by Statistics Lithuania on October 10 showed.

Inflation has remained positive every month since the start of this year on the back of rising household income and stabilising oil prices. The index grew 0.6% in monthly terms in September, reversing on a drop of 0.5% in August.

Prices increased in most segments, with a 6% y/y boost in the recreation and culture segment the largest gain, followed by a 5.8% increase in hotels and restaurant. Prices fell the most in the communication sector, contracting 6.6%. There also was a fall of 2.2% in the transport sector, while prices in the utility sector decreased 2.9%. 

Overall, there is a divergence between price growth in the goods segment versus that in the services segment, with the latter becoming 3.2% more expensive in annual terms in September. Prices of goods, on the other hand, only grew 0.1%.

The divergence is set to continue, according to Swedbank. The bank expects average annual inflation to reach 1.2% in 2016 and 3.0% in 2017.