Estonia: Inflation continues to ease in December
January 8, 2014
Consumer prices fell 0.1% over the previous month in December, which came in above the 0.4% decrease observed in November. According to Statistics Estonia, a drop in housing prices as well as lower prices for alcoholic beverages and tobacco were the main drivers behind December's fall.
Annual inflation fell from 1.5% in November to 1.4% in December, which is the lowest rate since February 2010. HICP inflation - based on the harmonized index of consumer prices - continued the downward trend that has been in place since July 2013 and dropped from 2.2% in October to 2.1% in November (the last month for which data is available).
Annual average HICP inflation inched down from 3.5% in October to 3.4% in November.
The Central Bank expects HICP inflation of 2.3% in 2014 and of 3.0% in 2015. FocusEconomics Consensus Forecast panelists expect harmonized inflation to average 2.8% in 2014, which is down 0.1 percentage points from last month's forecast. In 2015, the panel expects average inflation to accelerate to 3.0%.
Author: Carl Kelly, Economist