Flash comment: Lithuania - June 8, 2017
Annual inflation eases marginally in May

Annual consumer price growth decelerated marginally to 3.4% in May. Meanwhile, the average annual inflation picked up to 1.8%. Higher prices of alcohol (resulted by a hike in excise duties) and fuel, as well as those of restaurant services contributed most to annual inflation. Monthly inflation eased mostly due to seasonal factors as well as due to cheaper oil (in monthly terms).

Annual growth in the prices of goods eased to 3%. Meanwhile, that of services accelerated to 4.8%, driven largely by rapid wage growth, higher excise duties on alcohol as well as higher oil prices. The annual core inflation, which excludes volatile energy and food components, reached 4% in May and was at the highest level in 8 years.

Price pressures will remain strong

Price pressures will remain strong throughout this year mostly due to strong wage growth and likely higher prices of commodities. We expect the average annual inflation to reach 3% this year and to ease to 2.5% in 2018.

For more information about this report, please contact Mrs. Laura Galdikienė, +370 5 258 2275, Laura.Galdikiene@swedbank.lt

This email is sent through the Research Department’s web-based distribution system. As a subscriber you can change your settings regarding what publications you will receive by clicking “Change your settings” you can also unsubscribe by clicking "Unsubscribe".

This letter is distributed by Swedbank in cooperation with Brightly. The letter is personal.