Inflation in Latvia accelerates to 3.2% in August

Consumer price growth in Latvia picked up pace in August, with annual inflation reaching 3.2%, compared with 2.6% the previous month, according to data from the Central Statistical Bureau. On a monthly basis, prices rose by 0.3%. The average price level over the past 12 months, compared with the preceding 12 months, was up 3.3%.

Monthly price movements

Compared with July, the biggest upward pressure came from transport, where fuel prices jumped by more than 8%. Housing, heating and electricity costs also rose, along with personal care, recreation and culture spending. Food and non-alcoholic beverage prices, however, fell by 1.2% over the month, driven largely by cheaper potatoes, cheese and fresh fruit. Bread and eggs — products that saw a VAT rate cut in July — also became cheaper. Clothing and footwear prices dropped by more than 1%.

Transport and housing lead annual increases

Compared with August last year, transport had the largest impact on overall price growth, mainly due to fuel prices climbing over 22%, alongside rising housing, water and energy costs — heating energy was up nearly 9% year-on-year and natural gas by more than 16%. Recreation, culture, restaurant and accommodation services, as well as healthcare, also saw notable cost increases.

Meanwhile, food and non-alcoholic beverage prices fell 4% over the year, mainly due to cheaper butter, cheese, bread and several other food items, which helped offset overall inflation. Alcoholic beverages and pre-school education also became cheaper over the year, while cigarettes, clothing and car insurance rose in price.