Latvia: Inflation just inches up in August
September 10, 2015
Consumer prices dropped 0.6% in August over the previous month, which followed the 0.9% decrease tallied in July and marked a third consecutive drop. The statistical institute stated that lower prices for transport, as well as for food, were the main drivers behind the monthly decline.
After falling from a peak of 1.1% in May—a 30-month high—to a flat reading in July, inflation inched up to 0.1% in August. The reading continues rising fears that the country could enter into a deflationary spiral in the coming months if low energy and food prices persist. Annual average inflation inched down from 0.5% in July to 0.4% in August.
Harmonized consumer prices decreased 1.1% month-on-month in July (June: -0.1% mom), which is the last month for which data are available. Harmonized consumer prices fell 0.2% over the same month last year (June: +0.7% year-on-year). Annual average HICP inflation inched down from 0.6% in June to 0.5% in July.
Author: Ricardo Aceves, Senior Economist