Estonian Consumer Prices Grow Least in 28 Months on Food

Estonian inflation slowed to the weakest pace in 28 months in December on lower food and transport costs.

Consumer prices rose 3.5 percent from a year earlier, the least since August 2010, compared with a 3.6 percent advance the previous month, the statistics office, based in the capital, Tallinn, said on its website today. That’s in line with the 3.5 percent median estimate in a Bloomberg survey of three analysts. Prices fell 0.1 percent from November.

Declines in oil and food costs slowed last year’s average annual inflation in the newest euro-area member to 3.9 percent from 5 percent in 2011, the statistics office said.

In December, food was 5.4 percent more expensive than a year earlier, compared with 5.8 percent in November. Transport costs increased 0.6 percent from a year earlier last month, down from 1.6 percent in November.

This year, inflation will be temporarily boosted in January by Estonia’s electricity market opening and as state-owned utility AS Eesti Energia starts buying carbon-emission quotas from the market, the central bank said last month. Inflation may be further boosted by large structural unemployment, labor deficit and higher-than-forecast oil prices, the bank said.

To contact the reporter on this story: Ott Ummelas in Tallinn at oummelas@bloomberg.net

To contact the editor responsible for this story: Balazs Penz at bpenz@bloomberg.net

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