Romania posts highest inflation rate in EU for sixth month in a row

July was the sixth month in a row when Romania recorded the highest annual inflation rate among EU member states, at 4.3 percent – a decrease compared to the June rate of 4.7 percent, according to data from Eurostat.

The European Union annual inflation was 2.2 percent in July 2018, up from 2.1 percent in June. A year earlier, the rate was 1.5 percent.

Compared with June, annual inflation fell in nine member states, remained stable in six and rose in thirteen. The lowest annual rates were registered in Greece (0.8 percent), Denmark (0.9 percent) and Ireland (1.0 percent), while the highest rates were recorded in Romania (4.3 percent), Bulgaria (3.6 percent), Hungary (3.4 percent) and Estonia (3.3 percent).

In the euro area, the annual inflation rate was 2.1 percent in July, up from 2.0 percent. The highest contributions to the annual euro area inflation rate in July came from energy (+0.89 percentage points), followed by services (+0.64 pp), food, alcohol & tobacco (+0.49 pp) and non-energy industrial goods (+0.12 pp).

Data from the National Institute of Statistics showed that non-food products were 6.23 percent more expensive in July 2018 compared to the same month of 2017, food products had a 3.42 percent increase and prices of services increased by 2.68 percent.

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The National Bank of Romania has revised downwards the inflation prognosis for the end of this year, from 3.6 percent to 3.5 percent. For the end of 2019, the BNR expects an inflation rate of 2.7 percent.