DistantNews
Support us
Croatia's inflation falls to 4.2%, minister expects Eurozone levels by 2027
๐Ÿ‡ญ๐Ÿ‡ท Croatia /Economy & Trade

Croatia's inflation falls to 4.2%, minister expects Eurozone levels by 2027

From Veฤernji List · () Croatian

Translated from Croatian, summarized and contextualized by DistantNews.

At a glance

News Named sources New plan
  • Croatia's annual inflation rate fell to 4.2% in June, narrowing the gap with the Eurozone average.
  • Food inflation dropped to 1.8%, the lowest since early 2021, while services saw an 8.1% annual increase.
  • Finance Minister Tomislav ฤ†oriฤ‡ expects inflation to reach the Eurozone average by the first quarter of 2027, attributing the decline to government measures and easing energy and food price pressures.

Croatia's annual inflation rate has dropped to 4.2% in June, a significant decrease from 5.8% in April and 5.2% in May, according to the national statistics office. This brings the country closer to the Eurozone average of 2.8%, though Croatia still has the third-highest inflation rate in the EU, following Bulgaria and Lithuania.

The decline is largely attributed to easing pressures on energy and food prices. Food inflation, in particular, has fallen to 1.8% annually, its lowest point since the first half of 2021. A basket of food that cost 100 euros last year now costs 101.8 euros. However, services have become more expensive, with an 8.1% annual increase, an area where the government has limited direct influence.

The trend is clear. In April, inflation was 5.8 percent, in May 5.2 percent, and now we are at 4.5 percent. We expect a continued fall in the inflation rate and we believe that in the first quarter of 2027, we will reach the Eurozone average.

โ€” Tomislav ฤ†oriฤ‡The Finance Minister expressed satisfaction with the declining inflation rate and outlined future expectations.

Finance Minister Tomislav ฤ†oriฤ‡ expressed satisfaction with the trend, stating his expectation that Croatia will reach the Eurozone's inflation average by the first quarter of 2027. He credited government measures, including price caps on gas and electricity, fuel price controls, and a proposed windfall tax on extra profits, for contributing to the slowdown.

Despite the positive trend, some small business owners and landlords have expressed dissatisfaction with certain anti-inflationary measures. The minister acknowledged these concerns, describing the dialogue as a normal democratic process where the government provides counterarguments to their feedback. Analysts from RBA bank, however, place future inflation trends within a broader global context, noting that the duration of the conflict between Iran and the US could significantly impact supply chains and, consequently, consumer prices.

Some of the remarks they made to us, we understood and gave counterarguments. That is, after all, a normal democratic process.

โ€” Tomislav ฤ†oriฤ‡The Finance Minister addressed the dissatisfaction of some small business owners and landlords regarding government measures.
DistantNews Editorial

Originally published by Veฤernji List in Croatian. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

More Stories

From Our Blog