Prices in Latvia Have Almost Stopped Rising: Economists Forecast Inflation Slowdown 0 51

According to economist Swedbank Oskars Nikā Malnieks, consumer prices in June remained virtually unchanged compared to May, with annual inflation at around 3.4%.

The rise in prices was restrained by a further decrease in fuel costs — over the month, it fell by approximately 6.7%. Additionally, traditionally at the beginning of summer, prices for clothing and footwear may have decreased due to seasonal sales.

Chief economist Citadele Kārlis Purgailis also expects nearly zero monthly inflation. According to his forecast, the annual figure will drop to 3.3%, while in May it was 3.5%.

In the expert's opinion, a significant role was played by the stabilization of energy prices following the easing of tensions in the Middle East. However, this effect may prove to be temporary.

Economists warn that a decrease in inflation does not necessarily mean a general reduction in the prices of goods and services. It only indicates that prices continue to rise at a slower pace than before.

Purgailis believes that inflation may accelerate slightly again in the coming months, primarily in the services sector. The costs of services will continue to be influenced by the effects of the spring rise in energy prices.

A similar assessment is provided by economist Luminor Bank Pēteris Strautiņš. According to his calculations, prices may have even decreased by 0.1% in June compared to May, while the annual growth was about 3.3%.

He notes that for the third consecutive month, the price dynamics remain close to what is typical for this time of year. The only exception was March, when inflation temporarily accelerated and continues to affect the annual figure.

Strautiņš also believes that food prices in June remained virtually unchanged or slightly decreased. Meanwhile, services related to travel and summer recreation traditionally continue to rise in price, and this season, in his opinion, is no exception.

The official inflation data for June will be published later by the Central Statistical Bureau. They will show how accurate the economists' forecasts were.