Lithuania Inflation November 2007

Lithuania's inflation rate accelerated in November to the fastest pace in a decade, deepening concern the Baltic nation's economy may be overheating. The inflation rate rose to 7.8 percent, the highest since December 1997, from 7.6 percent in October, according to the Vilnius-based statistics office today. Prices rose a monthly 1.1 percent, compared with 1.5 percent in October.



Lithuania is struggling to contain consumer-price growth as the economy expands at the second-fastest pace in the European Union after Latvia. Gross domestic product rose 10.8 percent in the third quarter. On Dec. 7 Fitch Ratings followed Standard & Poor's in cutting Lithuania's credit rating outlook, citing the growing risk of an abrupt slowdown triggered by inflation.

Gas prices are scheduled to rise 69 percent for Lithuanian citizens next year.

Food costs, the biggest item in the consumer basket with a 25.9 percent weighting, rose an annual 15.4 percent in November. Household expenses such as gas, water and electricity, the second biggest category in the index, rose 11.3 percent.