Latvia: Inflation jumps to 16-month high
December 8, 2010
In November, consumer prices rose 0.2% over the previous month, half the price increase observed in October. The reading mainly reflected higher prices for food and non-alcoholic beverages (+1.2% month-on-month), which were partially offset by lower prices for clothing and footwear (-0.7% mom). Annual headline inflation jumped from 1.0% in October to 1.9% in November, which represented the highest level since July 2009. After 11 consecutive months of deflation, the economy returned to inflation in September. Annual average harmonised inflation rose from minus 1.9% in September to minus 1.8% in October (the last month for which data are available). In its September macroeconomic development report, the Central Bank expects harmonised inflation to average minus 1.6% in 2010 and minus 0.6% in 2011.
Author: Ricardo Aceves, Senior Economist