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Isarescu :Romania is preoccupied by the geopolitical and energetic situation and the considerable impact on inflation
Romania, such as many other EU member states is preoccupied by the geopolitical and energetic situation and the considerable impact on inflation, stated on Wednesday the governor of the National Bank of Romania (BNR), Mugur Isarescu , the Governor of the Central Bank, in a conference organised by BNR and the European Investment Bank (EIB).
‘At present, as in many EU member states, Romania is preoccupied by the geopolitical and energetic situation and their considerable impact on inflation. Inflationist shocks on the energetic compound of the consumption basket hit repeatedly during the second half of 2021. These were partially compensated by a governmental aid scheme, in force since 2021. Even so, the energetic part represented more than half of the global annual inflation until the end of 2021. It is a fact now that approximately 85% of IPC has roots in the increase of energy price. As a result, the inflationist expectations on the horizon of one year increased suddenly, reflecting the present evolutions. The positioning of expectations next to the key variation line suggests that the anchoring mechanism is still in function. Even so, a specific measure to approach the energy situation is a necessity” said Isarescu, at the conference with the issue “The support of the policies and new emerging normality: how well positioned are the Romanian companies?”
He mentioned that uncertainty continues to come from the evolution of the pandemics, taking into consideration the present wave, namely the more contagious variant of Omicron, although it seems to be less aggressive. This involves a lower severity of the corresponding restrictions, including in many European countries.
“As always, BNR will continue to use all political instruments to control inflation and to support the recovery of the economic activity” said Mugur Isarescu.
He stated that the conclusion could be, together with the BEI survey that the Covid-19 pandemics was a massive economic shock, counterattacked by an impressive answer of support measures.
‘The investment survey of BEI shows that the Romanian companies became more optimistic in 2021, several companies waiting to increase investments rather than to reduce them. We are happy to hear that, although we are aware of the efforts that Romania must take in several domains. It is the case of domains such as innovation or access to financing. Even so, we are happy to see that part of the companies in Romania invested already or intend to invest to approach the impact of the climatic changes, over the average at the level of the EU’
With regards to the responsibility of the BNR, he mentioned that, since the upbreak of the pandemics in March 2020, the institution has taken a series of measures in accordance with the situation.
The governor of the central bank said that Romania and BEI share a long and fruitful partnership which favoured investments in important sectors in our economy and mentioned there is room for this partnership to be extended, similarly on the basis of the new challenges on the European agenda.
The BNR governor stated that the Survey of investments of BEI is an excellent country analysis, and the conclusions may be added to the survey made by BNR about the access to financing of the non-financial corporations in Romania. He said that the BNR survey shows the opinion of the companies in real economy on the most important issues the companies are facing in their activity, the perception of the costs of financing, the perception on the involvement of a possible appreciation or depreciation of the national currency and the perception of the impact of climatic changes.