Inflation in Estonia in April was 4.5% over the year, while prices were a full 1% higher than in March.

Monthly core inflation without the volatile prices of energy and food was 1.7% in April. It was pushed up by rising prices for services, especially medical services, as hospital charges and fees for exceptional medical assistance increased in April. Hotel rates also rose sharply in April. Rising wages were a further factor in rising prices for services, and wage growth is forecast by Eesti Pank to average 6% this year. Yearly inflation for services will be affected until the end of the year by the fee for registering vehicles, which is recorded under services. The vehicle tax will add around 1.2 percentage points to inflation this year.

Food prices were 7.4% higher in April than they were a year earlier. One reason is that price rises for meat products on global markets are increasingly passing through into Estonian consumer prices, and meat products were 6% more expensive in April than they were a year ago. Energy prices fell in April. Natural gas cost more than it did a year earlier, but electricity and motor fuels were cheaper. Fuels for transport, which are about 5% of the consumer basket, were more than 10% cheaper than they were in April last year. Oil has fallen in price by about a quarter since the start of this year, and that fall has passed through into retail prices. Fuel prices have though been falling a little faster in the European Union on average than in Estonia since January 2025. For the rest of the year, fuel prices will be pushed up by tax rises, as excise on diesel rose in May, and excise on petrol will follow it in July. VAT will also rise in July, and it is estimated that the combined impact will add about six cents to the price of a litre of petrol.

Inflation may also fluctuate because of the wide-ranging tariffs announced by the USA in April. The confusion about trade restrictions and tariffs has so far caused prices to fall in markets for commodities and assets. Economic growth may consequently be weaker in the near term, including in the euro area. If growth slows, spending declines because of uncertainty, and prices for commodities fall, then inflation will come down. Prices may also be pushed down by imports of goods from other countries that cannot be sent to the USA and so will seek to enter the European Union market. If the European Union set its own defensive tariffs in retaliation though, prices would rise for imports, and inflation would rise for certain groups of goods. However, customs duties should not directly cause any price surge in the coming months as both the USA and the European Union have postponed the introduction of any additional tariffs for now.

Inflation in the euro area as a whole was 2.2% in April and it has been falling steadily since the start of the year towards the target of the European Central Bank of 2% a year on average across the euro area.

Additional information:

Viljar Rääsk
Head of Communications
Eesti Pank
6680 745, 5275 055
[email protected]
Press enquiries: [email protected]