Producer prices of products sold in the domestic market drop
After climbing for ten consecutive months, producer prices in October dropped 0.3% month-on-month. The overall drop in prices was determined by the reduced prices of goods sold in the domestic market, especially by the cheaper production of energy resources promoted by the drop in sales price of natural gas. Influenced by the rising global food prices, the prices of food products both sold domestically and exported continued to climb. According to the data of the International Monetary Fund, however, the rise in global wheat prices which resulted from worries over the harvest and which was the principal cause of the rapid rise in food prices, had already stopped in October.Thus there is good reason to expect a slowing down of price rises in Latvia as well.
Rises in producer prises will continue to depend on external factors: the influence of world food prices is already waning and any rise in global prices will also be limited by uncertainty over developments in the United States. External developments thus indicate that a rapid rise in producer prices is not expected in the near future.