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Flash comment: Latvia - January, 2012
09-01-2012 10:09
Latvian CPI inflation will continue to diminish in 2012
- Latvian consumer prices were constant in December 2011, in line with our expectations. In annual terms CPI growth continued to decelerate reaching 4%.
- In annual terms CPI growth continued to decelerate (for the fourth consecutive month). Prices in December were by 4% higher than a year ago (4.7% in August). During the year the most rapid price growth was observed in housing services’ (7.8% due to global oil price increase in early 2011 and raised electricity tariffs in spring), alcohol and tobacco (6.9% due to excise tax increases), transport (6.2% due to global oil price growth and excise tax hikes). Food price inflation decelerated notably in the second half of 2011 following global commodity price developments, but still amounted to 4.7% in December.
- With economic growth slowing and commodity prices retreating, we expect consumer price inflation to decelerate further in 2012. So far the forecast for average consumer price inflation in 2012 remains at 2.4%.
