Burdened with the highest inflation rates in the 27-member European Union, consumers in EU newcomers Estonia, Latvia and Lithuania are seeing cash vanish from pockets without a trace.

"By the end of the month we don't have any more money!" exclaimed Agnese, who is fresh back to work in the Latvian capital Riga after maternity leave.

With inflation having spiked to a 12-year high of 16.8 percent in March compared with the same month in 2007, the ex-Soviet Baltic republic has the highest rate in the entire European Union.

There is little to suggest inflation in this country of 2.3-million people will decline significantly any time soon.

"Now we have to borrow some money until the next salary," said Agnese (26), who declined to give her surname citing reluctance to speak publicly about personal finances.

She and her husband earn a combined 800-900 lats (?1150-1300, $1800-2020) per month, which she said is not enough to cover loan payments and living costs for themselves and their infant daughter.

"We aren't alcoholics and we're not into gambling. The money simply melts away and it's beginning to get on our nerves," she fumed.

"We can't afford any extras. I don't even dream about foreign trips. To save something from our salaries is mission impossible," she added.

Saddled with the inflation burden, Latvians are now wary shoppers, in sharp contrast with the retail frenzy of recent years that has fuelled spiralling economic growth.

"I've had to give up buying many things over the past half year. The situation with prices has really changed compared to a year ago ? especially, the rise in the price of food," said 30-year-old single mother Vineta, also a native of Riga. "I survive with the help of my relatives."

In neighbouring Lithuania ? which with 3.4-million people is the largest of the Baltic three states that broke free from the Soviet Union in 1991 and joined the EU and NATO in 2004 ? inflation reached an 11-year high of 11.3 percent in March.

'Retirement can mean just surviving, not a real life'

Baltic state consumers on fixed incomes, especially low state pensions, are perhaps the hardest hit by the spiralling cost of living.

"It is not true that prices increased by just 10 percent," said 67-year-old Lithuanian pensioner Jadvyga Zaltauskiene, who spoke before the March data was released on Tuesday.

"Prices for food increased much more. Buying the same foods like milk, bread or meat, I pay a quarter more or maybe even one third more than a year ago," she said, lamenting the shrinking buying power of her 600 litas (?174, $271) pension.

"It is the same for heating ? the prices went up by 25 percent," she said.

"I'm happy my children help me a little, but not everyone has children who do well," she added. "For people without help, retirement means just surviving, not a real life".

Consumers feel the squeeze

Consumers in Estonia, the smallest Baltic republic of 1.3-million people, are also feeling the squeeze.

There, inflation hit a 10-year record of 11.3 percent in February.

The fact that it dipped slightly in March to 10.9 percent, marking the end of six consecutive months of rises, was small comfort.

Prices for food and non-alcoholic beverages, as well as housing and transport, have all been climbing inexorably.

After 50 years working as an art teacher, 79-year-old Estonian pensioner Silvia Kalvik has a fixed monthly income worth ?270 ($423).

Inflation is eating away at her modest spending power, but Kalvik refuses to complain.

While she spent about ?70 per month on housing last year, this year costs have shot up to around ?100 per month, but thrifty shopping habits help her make ends meet.

"The food I buy costs around ?50 per month, but I select carefully what to buy. My phone bill is relatively small ? just around ?10 a month," she told AFP.

"So I manage by carefully counting what I spend ? I don't want to complain," she said. >/p>