Data from Statistics Estonia show that yearly inflation slowed in September to 4.2%. Inflation was last that low in June 2021. Food prices were 9% higher than a year earlier and energy prices were down 9.9%, while core inflation, which covers manufactured goods and services, was at 6.4%.

The overall price level in September was the same as in August, and any major movements in prices were caused by seasonal factors. The biggest falls were in the prices of accommodation services and rents. Among food prices, the price of vegetables fell, while prices for dairy products continued the decline that started in spring.

Trends for prices in September indicate that shops have probably not yet raised prices in anticipation of a rise in VAT. The deterioration in the economy and falling retail sales have made it harder for them to raise prices. The rise in price that will be sparked by tax changes from the new year may start to be reflected in higher prices for durable goods, and also in prices in sectors where competition is weaker.

Inflation may be higher in the coming months as compensation for energy prices, including electricity as a universal service, started in October last year, and will now pass out from the calculation of inflation. Eesti Pank forecasts that inflation this year will average 9.4%.

Additional information:
Hanna Jürgenson
Communications Specialist
Eesti Pank
Tel: 5692 0930
Press enquiries: [email protected]