Analytics, EU – Baltic States, Financial Services, Inflation, Lithuania

"The inflation is very easy to explain. Salaries have an effect on prices. The base effect – oil and food prices. In the end, our purely national aspect – taxes, a one-time factor that made Lithuania a champion even in comparison with neighbors," Vasiliauskas told journalists on Friday.

In his opinion, Lithuania's inflation would be similar to that of Latvia or Estonia, if the country hadn't considerably raised alcohol excise duties and temporarily lifted the value-added tax (VAT) discount on heating.

"Everyone (ECB members) understand that our situation is different as an economy that adapts and converges. We have states that are basically well-developed and we have countries that are still in development and are trying to come closer to the average. The structure of economies is different, and the cycles are different. The attitude is entirely natural and comprehensible," said Vasiliauskas.

According to Eurostat, Lithuania's harmonized annual inflation was 4.2% in October, standing at 4% in Estonia and 2.7% in Latvia. The average inflation was 1.7% across the EU and 1.4% in the euro area.