Last year, Estonian prices were 94 percent of the European Union's average and the gap narrows every year.

Many services are still considerably more affordable in Estonia than in the European Union as a whole, such as education, healthcare and transport.

But others are more expensive, such as food (9.3 percent above average) and clothes (18.6 percent above average). Estonian prices are still slightly below Finland.

On Sunday shoppers interviewed by "Aktuaalne kaamera" said that rising prices are forcing them to buy less than before and rely on discounts. An Estonian living in Finland said there is little difference in the price.

According to some analysts, prices may rise slightly in the second half of the year

But Lenno Uusküla, Luminor's chief economist, said prices are no longer rising so quickly and wages are growing faster than the EU average.

"It's true, we have not caught up to the level of purchasing power we had before the big price rise started in the summer of 2021 – we have not caught up and it is going to take some time before we do," he told AK.

"But now we are getting richer again. Wages are rising faster than prices and this is certainly set to continue. Prices have caught up with the average, wages have not. Wage convergence is still going on and wages are growing faster than in Europe as a whole," Uusküla said.

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