Average annual inflation remains steady at 2.4%

Due to the summer sales, monthly prices have decreased by 0.3% in July, whereas annual inflation remained steady for the sixth month in a row and stood at 2.4%. Prices of goods were 1.9% higher than a year ago, while prices of services grew by 4.5%. Prices of public services jumped by 3.9%, when compared to the same period a year ago.

Summer clothing sales were the main determinant influencing monthly deflation. Prices of clothing and footwear have decreased by 8.9%, when compared to the previous month.

Similarly, as in the previous months, housing, electricity and fuel, together with food and beverages have contributed the most to the total growth in consumer prices. Together they added almost 1pp to the annual CPI change. Housing, electricity and fuels added further 0.5pp increase. Transport, clothing and footwear, together with communications all cost less than a year ago and together contributed negative 0.4pp to the annual inflation. 

Similarly, as in the previous months, housing, electricity and fuel, together with food and beverages have contributed the most to the total growth in consumer prices. 

Outlook: inflation will stay close to current levels 

Price growth is set to stay close to the current pace in the near future and is expected to be close to 2.5% this year and the next. Prices of services will continue to be driven by rising labour costs and will grow faster than the prices of goods.