The EU statistics office reported that the HICP in the 27 EU countries together accelerated from 7.6% to 7.8%. in March. In its report, Eurostat uses the HICP index, which makes it possible to compare individual countries with each other.
Inflation in the EU even higher. Poland beyond the podium
This comparison shows that in March inflation fell only in two EU countries – Belgium and Slovenia, and increased in the remaining 25. It accelerated the most in the Netherlands – by 4.4 percentage points (from 7.3 to 11.7%), Estonia – by 3.2 percentage points. (from 11.6 to 14.8%) and Latvia – by 2.7 points (from 8.8 to 11.5%).
More news from the economy and the world
These countries are also in the group with the highest inflation among EU countries. According to Eurostat calculations, Poland had HICP inflation of 10.2% in March, which gave us the seventh position. The Lithuanians have the highest inflation – it is 15.6 per cent, followed by the aforementioned Estonia, and then the Czech Republic with the index at the level of 11.9 per cent.
The Lithuanian government has prepared to mitigate the effects of inflation on citizens. The plan is to be worth over EUR 2 billion and includes an increase in the threshold of non-taxable income, an increase in pensions, child and social benefits, and an extension of the heating subsidy program.
Poland has had its government anti-inflation shield for many weeks, hence probably lower inflation readings in Poland compared to some countries in the region. According to experts, the shield may keep inflation at an elevated level for longer. Perhaps that is why the International Monetary Fund forecasts that the average annual inflation in Poland next year will be higher than in the current one.
The economist of the central bank of Estonia, Sulev Pert, commenting on the latest inflation data (according to the national methodology it was 15.2% year on year in March), pointed out, inter alia, on food prices, writing that “since most of Estonia’s fruit and vegetables come from elsewhere, long supply chains may have increased inflation of imported food products.”
that wages will increase slower than prices in Estonia this year. “Increased costs of basic expenses will change consumption habits as consumers will have less money to buy services and consumer goods. Households spend an average of 15% of their income on energy and 28% on food,” writes Sulev.
Who has the lowest inflation in the EU?
Malta has the lowest inflation (4.5%), followed by France (5.1%) and Portugal (5.5%). A dozen or so months ago, we would consider such levels to be elevated also in Poland, where inflation is usually higher than in Western countries (for structural reasons, including the specificity of the labor market, similarly to other eastern EU countries). The NBP’s inflation target, i.e. the level of inflation that is optimal for the Polish central bank, is 2.5 percent. with possible fluctuations of 1 percentage point both ways.
The European Central Bank would like to keep inflation close to 2% in the medium term. Meanwhile, the index in the euro zone was 7.4% in March. (it was 5.9 in February) – this is a record high. The prices of energy (4.36 percentage points), services (1.12 percentage points) and food, alcohol and tobacco (1.07 percentage points) were the most powerful.
Source: Gazeta
Ricardo is a renowned author and journalist, known for his exceptional writing on top-news stories. He currently works as a writer at the 247 News Agency, where he is known for his ability to deliver breaking news and insightful analysis on the most pressing issues of the day.
