The Central Bank of Estonia published commentary on Statistics Estonia's May inflation data, stating that consumer prices were 3.7% higher than a year earlier and that the main driver was higher motor fuel prices. Fuel market pressures outweighed easing food inflation and limited price growth in most manufactured goods. Diesel prices were 32% higher than a year earlier, reflecting tight supply, high refining margins and sensitivity to developments in the Middle East, although competition between fuel retailers in Estonia has partly restrained increases. Food inflation slowed from 6% at the start of the year to 2% in May as lower global food commodity prices reduced producer and import prices, especially for butter, dairy products and cereals, while manufactured goods prices rose 0.9% and electronics became more expensive, with memory storage devices up 37%. The bank said the near-term path of inflation will depend largely on service prices as the holiday season starts. It expects seasonal inflation to be lower than last year, when leisure services prices rose sharply during several large events, and noted that the 1.5 percentage point inflation effect from last year's VAT increase will drop out.
Central Bank of Estonia2026-06-05
Central Bank of Estonia says May inflation was 3.7% and driven mainly by motor fuel prices
The Central Bank of Estonia commented on May inflation data, noting consumer prices rose 3.7% year-on-year, driven mainly by higher motor fuel prices, particularly a 32% increase in diesel. It highlighted easing food inflation, modest manufactured goods price growth, and rising electronics prices. The bank said near-term inflation will hinge on service prices during the holiday season, expected to be lower than last year as the impact of past large events and the prior value-added tax increase fades.