Luminor economist warns of broader inflation risks

Luminor chief economist Žygimantas Mauricas warns that the prolonged energy crisis threatens to trigger a broader wave of inflation across the Eurozone. While the current price surge is most visible in energy commodities, there is a significant risk that these costs will eventually be passed on to food, goods, and services.

Mauricas compares inflation to a snowball effect. He notes that while Lithuanian consumers have not yet felt a major spike in food prices, broader food price indices are already showing upward pressure. As energy costs remain high, they impact production, transport, and logistics, increasing the likelihood that businesses will transfer these costs to consumers. The economist suggests that if the trend continues, the next layers of inflation could include food, services, and eventually wage increases as workers seek higher pay to match rising costs.