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International Monetary Fund

The spike in Slovenian inflation in 2007–08 has shown how structural bottlenecks may hamper Slovenian growth in the future. This Selected Issues paper investigates the role of supply factors and demand-side effects in explaining this surge. The paper concludes that the spike in Slovenian inflation in 2007–08 was a consequence of cost-push and demand-pull factors. The supply-side factors, including the spike in commodity prices and demand-pull factors related to the business cycle, explained approximately two-thirds of the surge.