Estonia: Inflation falls to lowest level in nearly four years
February 7, 2014
Consumer prices rose 0.4% over the previous month in January, which contrasted the 0.1% decrease observed in December. According to Statistics Estonia, the increase was primarily driven by higher prices for alcoholic beverages and tobacco, as well as for food products.
Annual inflation fell from 1.4% in December to 1.1% in January, which marked 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 2.1% in November to 2.0% in December (the last month for which data are available).
Annual average HICP inflation inched down from 3.4% in November to 3.3% in December.
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