Inflation Risk To Eurozone Entry

July 2005
Emerging Europe Monitor: Central Europe & Baltic States;Jul2005, Vol. 12 Issue 7, p10
Country Report
Country Report
The article reports on developments related to the financial conditions in Estonia. The central bank estimates that the slower pace of tax reduction could save the budget as much as 0.5% of gross demestic product in 2006-07 compared with previous plans. Central bank officials believe that sharp rises in indirect taxes could add at least 0.5 percentage points to headline inflation in 2006. The government says it is monitoring inflation developments closely and that one way to take the edge off price pressures in the short term would be to call a halt to further increases in administered prices.


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