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https://www.eesti.ca/inflation-in-the-baltics-a-warning-for-the-rest-of-europe-ft/article59854
Inflation in the Baltics: a warning for the rest of Europe - FT
28 Dec 2022 EWR Online
Aibė grocery store. ‘When the war broke out, people’s purchasing power dropped and they started saving money,’ says Gintarė, the store’s 32-year-old cashier © Tadas Kazakevicius/FT - pics/2022/12/59854_002_t.jpg
Aibė grocery store. ‘When the war broke out, people’s purchasing power dropped and they started saving money,’ says Gintarė, the store’s 32-year-old cashier © Tadas Kazakevicius/FT
When inflation reached an almost unthinkable 20 per cent this year in Lithuania, residents in the rural south of the Baltic country began to tighten their belts.

“People are buying less. It’s hard. Everybody is trying harder, wearing what they already have more, shopping less,” says Laima, a 58-year-old woman who sells socks and other clothes from the boot of her car.

Across the main road in Sangrūda, a sleepy village of 200 people close to the border with Poland, it is the same story at the Aibė grocery store. “When the war broke out, people’s purchasing power dropped and they started saving money,” says Gintarė, the 32-year-old cashier. “Fuel and heating became more expensive, electricity, taxes . . . And food was left as the last thing to think of. People take what is most important now, cheaper goods, discounted ones.”

Inflation has been on the rise across the west to levels last seen decades ago, but few places have experienced a rise in prices quite like Estonia, Latvia and Lithuania, where inflation rose above 20 per cent this summer and is still above 21 per cent in all three countries.

While there are local factors that explain some of the surge, policymakers in the Baltics warn that the region is providing an early indicator of how price pressures could develop across Europe over the next year, even if the headline rate of inflation peaks.

https://www.ft.com/content/cf8...
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