Will prices stop rising and rate of inflation slow down?

Inflation will slow down in a month because energy resources will be cheaper, caretaker Minister of Economy, Nikola Stoyanov, announced in the BNT morning programme on October 28. However, he said, food prices will continue to rise and the ministry plans to make frequent checks for price speculation.

Orhan Jamilov and his wife have a 5-year-old son. Orhan works as a consultant in a shop and his wife is a laboratory assistant in a large company in Rousse. Their total monthly income is about 1,800 BGN, which is enough for the bare necessities.

"In this crisis, most money is spent mainly on food to take home, electricity, water - that's it," says Orhan Jamilov.

The family managed to get through last winter without a problem because of the warm weather, but expects this winter to be more severe, so money for electricity has been set aside in the family budget.

"We cut back spending on buying clothes, but we do not cut back on food," Orhan Jamilov added.

According to caretaker Minister of Economy Nikola Stoyanov, high energy prices have been contained and this will also reduce inflation, which has so far reached levels of the crisis of 1998.

"From October we will see that this increse will stop, we see that it is slowing down as we expected and I think that in October the figures will be better and to some extent inflation is contained through the price of energy carriers," said Nikola Stoyanov, caretaker minister of economy.

However, the minister predicted that food price will continue to rise, but the ministry will launch checks to see if there is speculation on the market.

However, according to the business sector, a serious risk to inflation is the state's own policies and the infusion of more social spending.

“This is normal to happen, the point is not to help inflationary processes in this way. Excessive spending, which is borne by the budget without revenue in return, also puts people's purchasing power at risk," said Maria Mincheva - deputy chairwoman of the BIA.

Former Finance Minister Simeon Djankov is also calling for a tightening of spending, saying that the flat VAT rate should be reinstated and the aid for businesses should be limited.

"We need to spend on infrastructure because that increases economic growth and social payments and energy aid for businesses should be very seriously reviewed and reduced in some parts," said Simeon Djankov, former finance minister.

According to Djankov's forecasts, there will be no problem with state spending even if the current budget is maintained next year, but only until April.

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