July CPI drops by 0.5%

TIRANA, August 9 – Albania’s Institute of Statistics (INSTAT) announced that the consumer price index, CPI, in July reached 3.4 percent year-on-year dropping by 0.5 percent compared to last June. One year ago, the CPI was up 2.2 percent. The low inflation rate is mainly attributed to domestic production, especially that of vegetables whose prices fell by 8.2 percent in July 2010. Eggplant, pepper and onion prices registered sharp drops of 33, 31 and 26 percent respectively. Fruit prices also fell by 3.3 percent.
Diesel and petrol prices continued rising even in June with 0.1 and 0.2 percent, respectively. Tobacco and alcoholic drink prices rose by 0.2 percent each.
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, administrative price increases may drive headline inflation temporarily above the 3ѱ percent target band in the near term.