PPI inflation decelerates to 1.1% y/y in EstoniaPPI inflation decelerated to 1.1% y/y in May, from 1.6% y/y in April, according to figures of the statistical office, published on Thursday. The deceleration was attributed to the manufacturing sector, where prices dropped by 0.1% y/y, the first decline registered since February this year. The decline was mainly driven by a price decrease in the production of electronic equipment and fuel oil, along with heat energy supply. On the other hand, the manufacture of wood products and chemicals exerted upward pressure on the headline manufacturing index.
External PPI inflation increased by at 0.5% y/y, while domestic PPI inflation decelerated to 1.1% y/y in May, down from 1.5% y/y in April. Looking at PPI figures, we expect that CPI Inflation might slow down somewhat in the coming months. To remind, consumer price growth edged down to 3.1% y/y in May.