aA
Prices of consumer goods and services declined by 0.5% in July, compared with June, but annual inflation accelerated to 0.3%. Average annual inflation was at 0.3% in July – 1.9 percentage points lower than a year ago.
Annual inflation at 0.3% in July in Lithuania
© DELFI (J.Markevičiaus nuotr.)

In monthly terms, prices fell mainly due to seasonal sales of clothing and footwear, as well as due to lower prices of gas (-9.4%). On the other hand, higher prices of air transportation services (15%), holidays, coffee and tea, and those of medical services had a positive effect on monthly inflation.

Higher prices of solid fuels (17.9%), dairy products and eggs, water supply, sewerage and refuse collection services, those of housing rentals, as well as an increase in the prices of alcohol and tobacco products, resulted by the excise duty hikes in March and April, had the largest positive contribution to annual CPI growth. As a result of declining global energy prices, the modernization of the heating sector and lower gas prices by Gazprom, the prices of heating in July for Lithuanian consumers declined by 17.3%, those of gas - by 13.9% and of electricity – by 5.4%, in annual terms. Fierce competition among mobile telephone operators drove down the prices of communications by 5.2%. In general, prices of goods in Lithuania declined by 0.1%, while prices of services increased by 1.6%, in annual terms.

Producer prices in the Lithuanian market contracted by 4.8% in July. Due to still weak commodity markets and still little pressure on prices from rising labor costs, producer prices have been declining for over a year now and thus have had a negative effect on the consumer price inflation.

Outlook: Inflation will remain low this and next year

Due to favourable commodity price developments, a decline in the prices of natural gas, cheaper food products as a result of a ban imposed by Russia on all food and agricultural products from the EU, as well as a lack of other drivers of inflation, consumer price growth will remain moderate this year and probably will be below our forecasted 0.8 %.

The build-up of wage pressures resulted by the warming up labour market has become a more distant prospect – it will most likely not materialize next year and thus will not have a significant effect of inflation. In addition, the Russia ban on food products might bring down the prices of food in Lithuania, thus inflation will most likely stay below our forecasted 2.5% in 2015.


|Populiariausi straipsniai ir video

Number of workplace deaths down by one-third

The number of workplace deaths in Lithuania shrank by 33 percent, or 7 cases, in the first half of...

Unique integrated health monitoring system for stroke survivors patented in Lithuania

Group of biomedical engineers from biotech company Gruppo Fos Lithuania together with researchers at...

President hopes for fair distribution of EU recovery fund

Increased financing for the European Union’s (EU) cohesion policy is one of the biggest expectations...

Lithuanian Airports regain their tempo

The three international airports of Lithuania summarised the results of the second quarter and...

Vilnius approved works of arrangement of the environment of the Palace of Concerts and Sports

The Vilnius City Council approved a joint activity agreement between the Vilnius City Administration...

Top news

Polish voters in Vilnius support Trzaskowski by large margin

A large majority of Polish citizens who cast their votes in Vilnius in Poland 's presidential...

President hopes for fair distribution of EU recovery fund

Increased financing for the European Union’s (EU) cohesion policy is one of the biggest expectations...

5 new coronavirus cases

On Sunday, 5 new coronavirus cases were recorded in Lithuania. Overall, it adds to 1874 confirmed...

Grand Courtyard of the Seimas opens to the public

From Monday, 13 July 2020, the Grand Courtyard of the Seimas will be opened to the public....

Skvernelis to lead Farmers and Greens' list in election

Lithuanian Prime Minister Saulius Skvernelis will lead the Farmers and Greens Union 's candidate list...

|Maža didelių žinių kaina