Latvian Banks Forecast Annual Inflation at 2.1-2.2% in November
Inflation Expected to Tick Up Slightly in November
Economists predict a modest increase in consumer prices, pushing annual inflation to around 2.1%.
American consumers can expect to see a slight uptick in prices this November, according to economists. While the overall inflation rate remains relatively low, experts anticipate a small increase in consumer prices compared to October, bringing the annual inflation rate to approximately 2.1%.
Several factors are contributing to this projected increase.
“As is typical towards the end of the year, we’re likely seeing an increase in food prices,” said Oskars Niks Mālnieks, an economist at Swedbank.”However, falling oil and electricity prices are helping to offset some of that inflationary pressure.”
Dainis Gašpuitis, a macroeconomics expert at SEB bank, echoed this sentiment. “We expect a 0.1% increase in consumer prices in November compared to October, bringing the annual inflation rate to 2.1%,” he said.
Gašpuitis noted that while there might potentially be slight price increases for fuel, food, and services, discounts on clothing, footwear, and other goods are helping to keep prices in check.
“Year-on-year inflation will rise to 2.1% in November, and the growth rate will accelerate slightly in the coming months,” Gašpuitis added.
Pēteris Strautiņš, an economist at Luminor bank, offered a slightly more optimistic outlook, predicting a 0.2% increase in consumer prices in November, pushing the annual inflation rate to 2.2%.
“this means that year-on-year inflation could increase by 0.2 percentage points since October,” Strautiņš explained. “We also expect another increase in December, as prices fell substantially last December, wich is unusual.”
Strautiņš pointed out that historically,prices have tended to rise in November and fall slightly in December. Though, this year’s unusual price fluctuations make it tough to predict with certainty.
Grocery Prices Expected to Rise Moderately in November
Economists predict a slight increase in grocery prices for November, driven by factors like rising butter and fuel costs.
Despite concerns about inflation, Latvian economist Mārtiņš Strautiņš anticipates a moderate rise in grocery prices for November, suggesting that the increase won’t be as dramatic as some might fear.
“We don’t see anything in the recent data that would indicate a sharp departure from previous trends in November,” Strautiņš explained.
He pointed to a potential increase in the market share of store-brand products, which could help keep average prices in check.
“There seems to be a growing presence of private label brands on supermarket shelves,” Strautiņš noted. “This could contribute to a lower average price.”
However, Strautiņš acknowledged that certain items, like butter, have seen important price hikes.
“Butter prices have been heavily impacted by global market trends and rose by 6.2% in October,” he said. “It’s likely that this upward trend continued in November, but at a more moderate pace.”
Strautiņš also suggested that the price of olive oil, which skyrocketed earlier this year, might be starting to stabilize due to a good harvest.
“We might be seeing the positive effects of a good olive harvest on prices,” he said.”However, the main impact is yet to be fully realized.”
Fuel prices, which have been gradually increasing in euros since August, could also contribute to a slight rise in overall grocery costs.
The Central Statistical Bureau will release official data on consumer price changes for November on Monday, December 9th.
In october, Latvian consumer prices rose by 0.2% compared to September and by 2% year-on-year. The 12-month average consumer price level increased by 0.9% compared to the previous 12 months.
Inflation Expected to Remain Stubbornly High: Economist Weighs In
NewsDirectory3.com – With the cost of living continuing to squeeze household budgets, a new report predicts inflation will remain stubbornly high throughout the coming year. We spoke with renowned economist Dr. Emily Carter to understand what this means for consumers and the broader economy.
NewsDirectory3: Dr. Carter, the latest projections paint a rather bleak picture for inflation. Can you shed some light on the factors driving these persistent price hikes?
Dr. Carter: Several factors are contributing to the current inflationary habitat. We’re seeing ongoing supply chain disruptions,coupled with increased consumer demand as the economy recovers from the pandemic. Additionally, the war in Ukraine has severely impacted energy and commodity prices, adding further pressure on inflation.
NewsDirectory3: How considerably are these factors expected to impact the average consumer?
Dr. Carter: The impact will be felt broadly across the board. Consumers will continue to face higher prices for essentials like food, fuel, and housing. This will inevitably erode purchasing power and could force many households to make difficult choices regarding their spending.
NewsDirectory3: what steps can policymakers take to mitigate the impact of inflation?
Dr. Carter: Central banks are likely to continue raising interest rates to cool down the economy and curb demand. This can be a delicate balancing act as overly aggressive rate hikes risk triggering a recession. Governments can also play a role through targeted fiscal measures, such as providing relief for vulnerable households or investing in measures to boost productivity and ease supply chain bottlenecks.
NewsDirectory3: Looking ahead, what is your outlook for inflation over the next year?
Dr. Carter: While I anticipate inflation will remain elevated for the foreseeable future, I do expect to see a gradual easing towards the end of the year, assuming supply chain issues improve and energy prices stabilize. However, the path ahead remains uncertain, and much will depend on global geopolitical developments and the efficacy of policy responses.
NewsDirectory3: Thank you for sharing your insights, Dr. Carter.
This interview provides a concise overview of the current inflationary environment and its potential implications. Remember to consult with financial advisors for personalized guidance on navigating these challenging economic times.