Inflation remains at record-high levels in November in Latvia

The latest data published by the Central Statistical Bureau on December 8 show that in November 2022, compared to November 2021, the average level of consumer prices increased by 21.8%, the same as in October.

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Compared to November 2021, in November 2022 the average level of consumer prices was mainly influenced by the goods and services related to housing (7.5 percentage points), food and non-alcoholic beverages (7.5 percentage points), goods and services related to transport (2.5 percentage points), miscellaneous goods and services group (0.9 percentage points), restaurant and hotel services (0.7 percentage points).

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Over the year, prices within the group of food and non-alcoholic beverages increased by 29.5 %. The average level of alcoholic beverage and tobacco product prices rose by 6.2 %. 

Average level of prices of goods and services related to housing rose by 44.4 %. 

Prices of goods and services related to transport increased by 18.2 %, which was determined by the rise in prices of fuels for transport by 28.4 %.

Compared to October 2022, in November 2022 the average level of consumer prices increased by 1.1 %. Food and non-alcoholic beverages (0.4 percentage points), goods and services related to housing (0.2 percentage points), miscellaneous goods and services group (0.2 percentage points), and furnishings (0.1 percentage point) contributed the most to the price level increase.

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Compared to 2015, in November 2022 consumer prices were 41.8 % higher. Prices of goods increased by 44.9 % and prices of services by 31.2 %.

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Commenting on the data, the Ministry of Finance (FM) said: "Based on the latest data on gas, oil and food prices in the world, an increase in inflation is not expected in Latvia in the coming months. The increase in consumer prices in December in annual terms will be very close to the level observed in recent months, thus the average inflation in 2022 could reach 17.3%.

"The determining role for such a rapid increase in consumer prices is mainly related to external factors, i.e. the increase in energy and food prices in the world. In the current geopolitical conditions, it is difficult to say whether the price increase in Latvia reached its peak, as there is still great uncertainty surrounding gas prices in Europe. If gas prices do not increase sharply in the short term, there is no reason to expect an even higher increase in consumer prices. Inflation will remain around 21%-22% in Latvia until the spring of next year, but after that the price increase will gradually decrease due to the high base."

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