Inflation rate climbs to 3.4%

TIRANA, September 13 – Albania’s Consumer price index (CPI) continued remaining within the central bank’s 3ѱ percent target band last September, despite a 0.7 increase compared to August 2010. Institute of Statistics (INSTAT) data show the CPI increased by 3.4 percent year-on-year last September. One year ago the change was a minimum 2 percent.
Year-on-year, prices of food and non-alcoholic beverages rose 1.6 percent in September. The biggest increase within this group was reported in the “vegetables including potatoes” subgroup. Prices of alcoholic beverages and tobacco increased 0.3 percent. Meanwhile, there was a 0.1 percent decline in prices of clothing and footwear. Transport costs also dropped by 0.3 percent with diesel and petrol prices down 0.1 percent.
The index for “rent, water, fuel and power” rose 0.3 percent with drinking water prices up 0.6 percent.
The 3.4 percent rate continues keeping the inflation rate within the central bank’s 3 percent target, plus/minus 1 percent, registering one of the lowest rates during the first half of this year.
Last February, the inflation rate registered a record 4.4 percent, exceeding the bank’s target by 0.4 percent mainly because of higher food and electricity prices.
According to the International Monetary Fund, the baseline inflation outlook remains favourable. Administrative price increases may drive headline inflation temporarily above the 3ѱ percent target band in the near term. However, underlying inflation is expected to remain under control, and annual inflation is projected at 3.5 percent in 2010 and 3 percent in the medium term, benefiting from the well entrenched credibility of the monetary policy framework.