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BNR downwardly adjusts its 2016 inflation projection to 0.6pct
The National Bank of Romania (BNR) has downwardly adjusted its 2016 inflation projection by 0.8 percentage points, to 0.6 percent, from its previous estimates this February, according to the bank's quarterly inflation report unveiled on Tuesday by BNR Governor Mugur Isarescu.
BNR's latest estimates of Romania's 2017 annual inflation read 2.7 percent, down from its previous estimates this February of 3.4 percent.
"The inflation core, particularly for 2017, is given by the CORE2 inflation rate [basic inflation, excluding a administered prices, volatile prices — of vegetables, fruit, eggs and fuels — tobacco product and alcohol prices]. We can see that the excess demand expected this year will have a say in defining our future behaviour. In an uncertain environment, the message of the BNR Administration Board is increased vigilance and prepared instruments to preserve price stability as well as financial stability," said Isarescu.
According to the report, first-round effects of cuts in the Value Added Tax (VAT) aside, annual inflation should reach 1.9 percent in 2016 and 2.9 percent in 2017.