Analytics, Covid-19, Inflation, Latvia, Markets and Companies

International Internet Magazine. Baltic States news & analytics Sunday, 27.09.2020, 00:28

In July, annual inflation in Latvia made 0.5%

Statistics Latvia, Riga, 10.08.2020.Print version
The latest data of the Central Statistical Bureau (CSB) show that in July 2020, compared to July 2019, the average level of consumer prices* increased by 0.5 %. Prices of services went up by 1.6 %, while prices of goods didn’t change.

Compared to 2015, in July 2020 consumer prices were 9.2 % higher. Prices of goods increased by 7.0 % and prices of services – by 14.7 %.


Compared to July 2019, in July 2020 the average level of consumer prices was mainly influenced by the rise in prices of food and non-alcoholic beverages, health care, restaurant and hotel services, goods and services related to recreation and culture, as well as drop in prices of goods and services related to transport, goods and services related to housing.



Over the year, prices within the group of food and non-alcoholic beverages increased by 2.8 %. Prices of fresh fruit (up by +19.6 %), including of apples, pears and oranges had the most significant upward impact on the average price level within the group. Upturn was registered also in prices of dried, salted or smoked meat (of +8.3 %), pork (+3.8 %), meat products (+5.4 %) and poultry (+2.2 %). Increase was recorded in prices of cheese and curd (of 2.8 %), bakery products (2.4 %), bread (1.7 %), buckwheat (19.4 %), coffee (2.5 %), ice cream (5.7 %) and breakfast cereals (9.8 %). Decline, in turn, was registered in prices of fresh vegetables (of 7.7 %), butter (6.4 %) and yoghurt (2.2 %).


Over the year, prices of goods and services related to housing dropped on average by 1.9 %. Decline was recorded in prices of natural gas, electricity, solid fuels, rentals for housing and heat energy, while increase was registered in prices of maintenance charges in multi-occupied buildings, services for the maintenance and repairs of the dwelling, materials for the maintenance and repairs of the dwelling.


Within the health care group, the average level of prices rose by 3.0 %, which was mainly influenced by the increase in prices of dental services, prices in general medical practice, as well as prices in medical specialist practice. Downturn was registered in prices of pharmaceutical products.




Prices of goods and services related to transport declined by 3.9 %, which was affected by the drop in prices of fuels for transport (of 11.2 %), mainly diesel (of 11.5 %). Prices of petrol reduced by 11.0 % and of auto gas – by 10.1 %. Increase over the year was observed in prices of passenger transport by road, maintenance and repair of personal transport equipment.

Goods and services related to recreation and culture became more expensive by 1.8 %. During the year, average level of prices increased for flowers, recreation and sports services, newspapers and magazines.


The average level of restaurant and hotel service prices went up by 2.8 %. Price rise was mainly affected by catering services, as the average level of restaurant and café service prices increased by 2.4 % and that of canteen services by 5.7 %.


The most significant upturns among other commodity groups were recorded in prices of clothing, tobacco products, articles for personal hygiene and beauty products, while downturns were recorded in prices of motor vehicle insurance and spirits.


Price changes by commodity group (as per cent)

Commodity group

Price changes in July 2020, compared to:

July 2019

December 2019

June 2020

Total

0.5

0.3

0.2

food

2.8

3.0

0.6

alcohol, tobacco

0.6

2.4

0.9

clothing, footwear

2.2

-2.0

-3.7

housing

-1.9

-3.4

-0.6

furnishings

1.7

2.7

0.8

health

3.0

2.5

0.8

transport

-3.9

-3.8

1.5

communication

0.9

1.3

0.0

recreation, culture

1.8

2.2

0.4

education

0.0

0.3

0.2

restaurants, hotels

2.8

3.1

0.5

miscellaneous

0.2

0.9

0.1


During the month, the average level of consumer prices rose by 0.2 %.


Compared to June 2020, in July 2020 the average level of consumer prices increased by 0.2 %. The average level of service prices went up by 0.5 % and of goods – by 0.1 %. Although price rise during the month usually was not typical for July, this time, in addition to seasonal factors and price changes characteristic to the month, an increase of trade activity as a result of elimination of Covid-19 restrictions also had significant impact.


The greatest pressure on the price changes was put by the rise in prices of goods and services related to transport, food and non-alcoholic beverages, spirits and tobacco products, health care, as well as by the drop in prices of clothing and footwear, goods and services related to housing.


Over the month, prices of food and non-alcoholic beverages grew by 0.6 %. Price rise of potatoes (of +36.6 %), as a result of continued new harvest trade, had the strongest upward influence on the average price level within the group. Due to the end of sales campaigns, increase was recorded in prices of poultry (of 2.1 %), dried, salted or smoked meat (1.2 %), bread (1.4 %), ice cream (4.8 %). Upturn was recorded in prices of pork (of 1.3 %), flours and other cereals (3.0 %) and chocolate (2.4 %). Reduction, in turn, was recorded in prices of bakery products (of 2.5 %), fresh vegetables (2.3 %), fresh fruits (1.6 %) and fresh or chilled fish (9.4 %).




The average level of alcoholic beverage and tobacco product prices rose by 0.9 %. As the sales campaigns ended, prices of wine, spirits and beer went up.


The average level of prices within clothing and footwear group fell by 3.7 %. Price drop mainly was influenced by discounts on garments (of 3.5 %) and footwear (4.9 %).


Average price level of goods and services related to housing dropped by 0.6 %, which was mainly influenced by lower natural gas tariffs as of 1 July. Downturn was registered in prices of heat energy on average by 1.3 %. In turn, an increase on average of 2.4 % was registered in rentals for housing.


Within the health care group, prices rose by 0.8 %. Prices of dental services and in medical specialist practice went up.


Prices of goods and services related to transport rose on average by 1.5 %. Prices of fuels for transport went up by 3.4 %, of which prices of diesel by 3.3 %, of petrol by – 3.2 %, and of auto gas – by 5.8 %. Prices of passenger transport by air increased as well.


Among other commodity groups, the most notable rise was registered in prices of household cleaning and maintenance products, flowers and hotel services.


COVID-19 influence on consumer price index in July

As impact of restrictions related to Covid-19 reduced, in July availability of goods and services and, therefore, volume of prices collected during price registration, returned to normal. Total number of imputations related to Covid-19 dropped to 0.8 %, which is 1.3 % of total household consumption expenditure.


Significant Covid-19 impact remained in two ECOICOP sub-classes – Passenger transport by sea (share of imputation 100 %); Package holidays (share of imputation 88 %). Imputations were calculated by the methods mentioned below in accordance with recommendations of Eurostat for compilation of indices under the impact of Covid-19:


  1. Imputation with the annual rate of change of all reliable price indices.
    (in July 2020 annual consumer price index of all "reliable” indices constituted 100.5);
  2. Imputation based on available prices for the same product.

Indices with significant number of imputations (> 50%) caused by Covid-19 and thus having lower quality in the CSB database are indicated with "u".

More detailed information on imputation methods used in Covid-19 circumstances, as well as action regarding compilation of indices in postcrisis circumstances is available in:

Information on consumer price changes in August 2020 will be published on 8 September.

*The annual inflation reflects consumer price changes, comparing the average price level in the comparison month with the average price level in the corresponding month of the previous year.







Search site