Inflation Climbed to 3.4% in July as Transport Costs Rose Sharply

Inflation in Albania continued to rise in July, reaching 3.4%. The rate increased for the second consecutive month and remained above the Bank of Albania’s 3% target.

Data from INSTAT show that inflation stood at 3.2% in June, while in July last year it was recorded at 2.5%. Compared with the previous month, consumer prices rose by 0.2% through the end of July.

Food, housing costs and transport continue to exert the greatest pressure on prices. However, transport ranked as the category with the highest annual increase this month.

Transport prices rose by 8% compared with July last year, mainly due to higher fuel prices. This group contributed 0.52 percentage points to overall inflation, while prices in the category rose by 4.7% in July alone.

After transport, the “Recreation, Sport and Culture” group recorded the second-highest annual increase, at 6%. Meanwhile, insurance and financial services became 4.5% more expensive.

Housing-related costs also continued to rise. Rents, water, electricity, gas and other fuels increased by 4.1% year on year, contributing 0.83 percentage points to inflation.

Food and non-alcoholic beverages remained the group with the greatest impact on price growth, contributing 1.18 percentage points. Despite this, food prices fell by 0.5% in July.

Compared with a year earlier, food prices were 3.5% higher.

Only two categories recorded annual price declines. Clothing and footwear became 1.8% cheaper, while information and communication products and services recorded a decline of 0.9%.

July’s figures show that inflationary pressures have broadened. In addition to food and housing costs, rising transport costs are having a significant impact on consumer prices and adding to the burden on household budgets.