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International Internet Magazine. Baltic States news & analytics Thursday, 17.01.2019, 09:26

Swedbank: food prices keep rising in Estonia contrary to global trend

BC, Tallinn, 08.02.2018.Print version
The price increase of food that supports Estonia's fast price growth is different compared to global trends because elsewhere the price growth of food has slowed down, chief economist at Swedbank Liis Elmik said, cites LETA/BNS.

"Food contributed to inflation the most. While in Estonia the fast increase in food prices continued at the start of the year, in the world as a whole food price growth has slowed down. According to the UN Food and Agriculture Organization (FA), the global prices of food products calculated in U.S. dollars did not change in January compared to the previous month and the prices of dairy products declined for the fourth month in a row," Elmik said in a press release on Wednesday.


High excise duty rates raised the prices of alcohol, tobacco and motor fuels in January. The latter was also affected by an increase in the price of oil. This year the prices of oil as well as other raw produce should grow less than last year. Swedbank forecasts the price of oil to increase on average 8% this year when calculated in euros.


According to Swedbank, price increase should slow down to 3% this year. Food, tobacco and alcohol are to contribute the most to inflation. An additional alcohol excise duty rate increase is to raise alcohol prices in February. The average gross salary is to rise twice as fast as prices -- 6%.


In January, the Estonian consumer price index increased 0.4% compared to December 2017 and 3.5% compared to January 2017, Statistics Estonia reported on Wednesday.


Compared to January 2017, the consumer price index was affected the most by food and non-alcoholic beverages, which contributed 40% of the total increase of the index. Milk, dairy products and eggs became 6.4%, fruit 13.3% and vegetables 11.5% more expensive. Alcoholic beverages and tobacco accounted for over a fifth of the total increase of the index. A half of the impact of alcoholic beverages and tobacco came from 23.8% more expensive beer.

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