Analytics, Economics, Estonia, Inflation

International Internet Magazine. Baltic States news & analytics Sunday, 11.05.2025, 04:57

SEB: inflation threat in Estonia might rather become a deflation threat

Juhan Tere, BC, Tallinn, 06.02.2009.Print version
As in February 2009 the prices of gas and of fuel will fall significantly, it is to be expected that an overall price decline will take place and in the second half the inflation threat in Estonia might rather become a deflation threat, estimated analyst of SEB Ruta Eier, writes Postimees Online.

"For the residents, the falling of such important inevitable costs as housing expenses is certainly a relief, as wages are rather falling than increasing," stated Eier.

 

SEB estimated that the inflation rate in January was smaller than previously predicted as instead of increasing the price of heating, it was lowered in January.

 

"Hence the principal component for the price growth this year has fallen away and the inflation rate will be lower than we previously predicted," explained Eier. She added that while thus far the price growth was mostly caused by a surge in administrative prices and growth in non-administrative prices had been slowing down for quite a while already, now the global deflation pressure has reached the administrative prices as well.





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