National Bank forecasts 4.7pct inflation for end-2024, 3.5pct for 2025

The National Bank of Romania (BNR) has downwardly revised, to 4.7%, its inflation forecast for the end of 2024, from 4.8% in November 2023, expecting it to go further down to 3.5% at the end of 2025, according to data released on Thursday by BNR Governor Mugur Isarescu.

"What does the forecast show? That the annual inflation rate will remain on a general downward trajectory, with this temporary interruption in January this year; the pace of disinflation is anticipated to slow significantly over the next year, and we will explain why. (...) The increase in inflation at the beginning of 2024 is not so pronounced, because it also refers to February and March and so the increase in January will be diminished, definitely. But then the trajectory is definitely down, it does not differ much - in our data it is 1-2 percentage points from the previous trajectory. It was revised downwards during 2024 and the return to the upper limit is forecast for 2025," Isarescu said upon releasing the bank's latest quarterly inflation report.

According to the presentation, the forecasted trajectory has been downwardly revised in 2024 because of more recent favourable developments in the indicator, especially the food prices. Thereafter, over the course of 2025, the path of inflation is slightly above those projected in the November report, amid a GDP gap that remains positive and, to a lesser extent, an upward revision in inflation expectations.

Developed by Codecraftsman