Economic growth in Latvia has come to a complete stop, while growth in Estonia is already negative.
Estoniahas so far been hit the hardest as it became the first country in Eastern Europe to dip into a recession following years of high growthdriven by credit. The country registered negative GDP alongside a double digitinflation rate.
"The decrease in the GDP was mostly influenced by the weakdomestic demand and at the same time by the decrease in exports of goods andservices," the national Estonian statistics service said in a report on thecountry's GDP growth.
Estonia'sinflation rate remained in the double digits in August at 11 percent. Thestatistics agency said a 17.1 percent increase in food prices was a maincontributor to the still high inflation rate.
The numbers reflect the Baltic states'continued fall into a widely predicted economic hard landing.
Latvia'sinflation, meanwhile, fell for the third straight month in August but remained15.7 percent, the highest in the Baltics. Inflationary data is not yetavailable for Bulgaria- which boasted the second highest rate in the EU in July at 14.5 percent - andso it is not yet clear whether Latviastill has the highest inflation rate in the bloc.
"Price decrease of vegetables and fuel, as well as priceincrease of clothing, catering services and housing rent had the greatestimpact on consumer price changes in August," the Latvian national statisticsoffice said in its report.
The country's GDP growth barely remained positive in thesecond quarter at only 0.1 percent higher than the same period in 2007. Manyanalysts predict that the trend will continue and the country will see negativeGDP growth by the end of the year.
Lithuaniahas so far suffered the softest economic landing of the three Baltic states. The country's average annual inflation rate in August hit10.3 percent, while year-on-year GDP growth in the second quarter stayed at 5.3percent.
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