Food and utility prices have been on the rise, driving an overall increase in consumer price inflation in many eastern European countries. As consumer costs increase in the winter months, public discontent is likely to grow, leading to protests, as evidenced by the recent violence and unrest in Kazakhstan, which started over fuel-price increases and quickly escalated into a wider political revolt.

Food-price growth due to high global food prices and increased demand as economies have rebounded, is one of the main drivers of inflation. Food prices have, on average, been growing at a much faster rate than overall inflation across the region and, in some places, contribute 30-40% percent of overall consumer price growth. Utility prices have increased globally and the crisis has been particularly acute in Europe, where high demand and low energy supply have driven up prices to historic highs. It seems unlikely that energy prices will go down substantially over the remainder of winter, and governments will come under pressure to extend substantial support to relieve pressure on consumers and businesses.

In some countries, governments already provide subsidies and capped prices but discontent has nevertheless begun to build. Protests have already occurred in parts of the western Balkans–Albania and Bosnia and Hercegovina, in particular. Inflation-related discontent has spiralled rapidly in Kazakhstan, where violent unrest has led to the deployment of foreign peacekeeping troops. The speed with which Kazakhstan’s fuel-price protests escalated into a broader challenge to the regime will concern other governments in the region, wary of a demonstration effect on their own citizens.